JM — Annual Report 2009

Mar 23, 2010

ANNUAL REPORT 2009

CONTENTS

• 1 THE  YEAR IN BRIEF
• 2 CEO'S COMMENTS
• 4 BUSINESS CONCEPT, GOALS AND STRATEGIES
• 6 JM's CORE BUSINESS
• 8 MARKET OVERVIEW
• 20 RESIDENTIAL BUILDING RIGHTS
• 22 PROJECT PROPERTIES
• 23 BUSINESS SEGMENTS
• 28 SUSTAINABLE URBAN PLANNING
• 34 EMPLOYEES
• 38 RISKSAND RISK MANAGEMENT

FINANCIAL REPORTS

• 43 BOARD OF DIRECTORS' REPORT
• GROUP: 47 INCOME STATEMENT
• 48 BALANCE SHEET
• 50 CASH FLOW STATEMENT
• 52 CHANGES IN EQUITY
• 53 NOTESTOTHE FINANCIAL STATEMENTS
• PARENT COMPANY: 69 INCOME STATEMENTAND
• CASH FLOW STATEMENT
• 70 BALANCE SHEET

• 71 CHANGES IN EQUITY

• 71 NOTESTOTHE FINANCIAL STATEMENTS

• 74 FIVE-YEAR OVERVIEW— GROUP
• 76 QUARTERLY OVERVIEW— GROUP
• 77 QUARTERLY OVERVIEW— BUSINESS SEGMENTS
• 78 PROPOSED DISPOSITION OF EARNINGS
• 79 AUDITorS' REPORT
• 80 DEFINITIONS  AND GLOSSARY

SHAREHOLDER information

• 82 CORPORATE GOVERNANCE REPORT
• 88 BOARD OF DIRECTORSAND AUDITORS
• 89 EXECUTIVE management
• 90 THE JM SHARE
• 92 NOTICE OFANNUAL GENERAL MEETING
• and financial calendar
• 93 JM's PROPERTIES 96 ADDRESSES

Cover photo: JM's offering is summarized by the "Smart Kvadrat" concept, which entails climate-smart thinking, financial security and room for different personalities.

This Annual Report is a translation of the original text in Swedish, which is the official version.

JM is one of the leading de velopers of housing and residential areas

in the Nordic region. Operations focus on new production of homes in attractive locations, with the main focus on expanding metropolitan areas and university towns in Sweden, Norway, Denmark, Finland and Belgium. We are also involved in project development of commercial premises and contract work, primarily in the Greater Stockholm area.

JM seeks to promote long-term quality and environmental considerations in all its operations. Annual sales total approximately SEK 9 billion and the company has some 1,900 employees.

JM AB is a public limited company listed on NASDAQ OMX Stockholm, Mid Cap segment.

Business concept

To create attractive living and working environments that satisfy individual needs both today and in the future.

Vision

JM creates houses where people feel at home.

Objecti ve for shareholder value

The goal is to give shareholders a higher total return than shareholders in companies with a similar risk profile and business activities.

Denmark

Belgium

Continued robust sales of residential units

• • Revenues fell 28 percent to SEK 8,778m (12,229) while the number of residential units sold increased to 3,291 (1,871)
• • Profit before tax dropped to SEK 547m (1,052) and the profit after tax for the year fell to SEK 379m (818). Write-downs of SEK 87m (320) for development properties were charged against operating profit during the second quarter. Operating margin decreased to 7.6 percent (8.9)
• • Property sales of SEK 665m (748) resulted in gains of SEK 89m (73)
• • Return on equity for the past twelve months was 11.0 percent (22.9). Earnings per share during the year amounted to SEK 4.60 (9.50)
• • Consolidated cash flow including net investment in properties totaled SEK 1,124m (101) after a strong cash flow during the fourth quarter
• • The Board of Directors proposes SEK 2.50 (0) in dividend for 2009.

SEKm	2009	2008	2007
Income	8,778	12,229	12,731
Operating profit	664	1,083	2,301
Profit before tax	547	1,052	2,297
Cash flow from operating activities	1,124	101	1,826
Operating margin (%)	7.6	8.9	18.1
Return on equity (%)	11.0	22.9	44.5
Equity/assets ratio (%)	37	32	39
Earnings per share (SEK)	4.60	9.50	18.30
Number residential units sold	3,291	1,871	3,880
Number of housing starts	2,150	1,829	4,065

For definitions, see page 80.

INCOME BY

OPERATING PROFIT BY BUSINESS SEGMENT, SEKm

GOOD PROSPECTS FOR OUR HOUSING DEVELOPMENT BUSINESS

In 2009 demand for our newly built homes steadily improved in Sweden and Norway, JM's main markets. Even in Denmark, demand has stabilized. We now have a positive trend moving toward more normal levels for sold residential units and housing starts.

In early 2009 it was difficult to determine the depth or duration of the recession and in late 2008 we took the decision to sharply reduce capacity, primarily in foreign operations. Adapting the organization to the changes in the market was critical. I am pleased at how quickly we have seen the results of these measures and that we have kept operations going so well during the year with respect to both current production and planning of interesting projects for the future. During the recession and the financial crisis we also intensified our efforts with project financing and sales.

Yet another measure to deal with the recession was the decision to use our building rights for production of rental units for external clients. Our long-term involvement in the local housing market has enabled JM and our subsidiaries to create trusting relationships with representatives from the local authorities. The number of sold residential units in the form of signed contracts during 2009 was 3,300, including 600 relating to rental projects for external clients, primarily public housing in the Stockholm region. The rental projects have focused on small, space-efficient homes for a somewhat different target group.

In all we had a total of about 2,100 housing starts which, although only half of the usual level of housing starts, it is still good considering the recession.

Consolidated revenues decreased from SEK 12 billion to about SEK 9 billion, mainly due to the significantly lower level of housing starts in 2008 and 2009.

BUILDING RIGHTS PORTFOLIO

With a low implementation rate in the projects, we actually have more than enough building rights for our needs and therefore we will continue to be restrictive about new acquisitions. Our portfolio of building rights is one of JM's most important assets and pivotal for us to be able to start working on good projects in the future. At year-end 2009/2010, we had available building rights corresponding to about 27,900 residential units. Two of the largest projects with construction start scheduled for 2010 are in the Stockholm area—Kvarnholmen in Nacka, with about 2,000 homes, and Dalénum on Lidingö, with about 900 homes.

Overthe past few years we have carried out a major change management project in "structured planning" where we have developed common solutionsfor proceduresthroughout our housing production. We have also been able to steer purchasing volumes toward fewer and more standardized components.

In 2009 we worked with a large development project in production. "Structured production" is one of the largest and most important change processes within JM. First we implement uniform working methods, then we optimize production, thereby further lowering production costs. A fundamental factor for success involvesimplementing uniform working methodsthroughout production, which will begin in 2010 and continue for several years.

By working with a process-oriented approach, we can streamline production and cut costs without compromising on our mission: building attractive homes that are problem-free for both the customer and JM.

FOCUS ON COSTS

With 65 years of experience, a market leading position in new construction of housing and close contact with the end customer, JM is considered to be a preferred customer by our suppliers. JM employees are closely involved with both agreements and suppliers. They participate and use their experience to influence the process, including collaborative development projects with our strategic suppliers. This collaboration benefits JM, the suppliers and home buyers in terms of both price and quality.

About 85 percent ofthe volume of building materials purchased at ourjob sitesin Sweden is ordered through central frame agreements. We want to further increase the percentage of frame agreements and will mainly focus on the subcontractorside. The goal isforthe increase in JM's costsfor goods and services, which are ordered as call-offsfrom the central frame agreements, to be less over the long-term than the consumer price index.

During the year we have particularly looked at the procurement process, with a focus on risk management, with respect to both goods and services.

GOOD ENVIRONMENTAL CHOICES

As Sweden's largest housing developer, we feel a major responsibility for the energy and climate change issue. It was only natural for usto show our commitment to the environment by participating in several important environment-related initiatives during the run-up to the big climate meeting in Copenhagen in December.

Our most important effort relating to the environment is, of course, through climate-smart planning, production and management. All housing production that JM initiate in Sweden since 2008 is planned based on ourlow-energy home concept, which falls well below the authorities' energy guidelines during operation. During the yearthe first families moved into JM'slow-energy houses and in the Sustainable urban planning section we tell about one of the families in Vallentuna, outside Stockholm.

We also work on making job sites energy efficient, for example by early startup of district heating for the house frames during construction and more energy efficient jobsite trailers. Another area involves construction transports, where greater

cooperation between different participants is important, as are better logistics and ordering procedures.

In December all employees at JM headquarters moved into the newly built office building in Solna. We have been able to closely monitor the construction project since the office was developed by JM Property Development and built by JM Production. Vasakronan is the client and owner of the office building, which complies with JM's guidelines for saving energy and meets the GreenBuilding standard, requiring energy consumption to be at least 25 percent less than the building standard.

HOUSING OF THE FUTURE

During the year we launched a new, more structured way of identifying and defining customer value. Moving ahead, we will continue to work with the housing issuesthat JM's customersfeel are most important by converting trends and customerinsightsinto clear customer offerings. In the Market overview section we discuss our offering under the "Smart Kvadrat" or "Smart Square" theme. For us, "Smart Kvadrat" represents an approach that focuses on carefully thought through and well-planned homes.

We take great pride in the high percentage of satisfied customers that we have today. In 2009 for the first time, Sweden has an industry Customer Satisfaction Index (CSI) for the entire housing development industry. JM received 72 out of 100 potential points on the CSI, which can be compared with the industry index of 70.

DEDICATED EMPLOYEES

At JM, safe and secure workplaces, along with opportunities for employee development are top priorities. Through the JM Academy we offer training programs specially designed for JM's employees, such as the "Certified Supervisor" program that started during the year. Supervisors, many of whom have an academic background in engineering, play one of many important roles in the production process.

JM made staff cuts to adapt the company to market conditions and our own needs, resulting in the unfortunate loss of about 600 employees during the year. Nevertheless, JM retained its core competency, housing development and construction, which has enabled us to continue to develop projects and to be able to quickly start new construction projects.

It is particularly gratifying that the employee survey conducted in the autumn of 2009 shows strong commitment among our employees and confidence in JM as an employer.

Confidence in our managers also ranked high among the employees. For me, actively working to ensure that we have a supply of leadership is important so that JM continues to have good managers and leaders.

GOOD FUNDAMENTALS

With good sales in current production and a healthy reservation rate, we can start production of new residential projects as project financing is arranged. The ability of the banking system to handle the supply of liquidity for new projects continues to be an important factor. At the same time there is a time lag in order to reallocate project resources to ensure that we maintain good control of our projects once volume increases.

In the long term, fundamentals continue to be good for our business. Population growth in the Stockholm market, which is so important forJM,reached record levelsin 2009, while housing startsremained very low. JM is dynamically positioned with financial strength and an excellent project portfolio that continues to be refined so we will be ready for future demand in our markets.

Stockholm, March 2010

Johan Skoglund

Nordic Region 's leading de veloper

BUSINESS CONCEPT

To create attractive living and working environments that satisfy individual needs both today and in the future.

The business concept means that JM is a project developer of housing and, selectively, of commercial premises. JM gives priority to high quality and a holistic approach in its design. The aim is to create living and working environments that will remain attractive over time.

VISION

JM creates houses where people feel at home.

According to this vision, people will be just as content living in their JM homes in the distant future as they are today.

OBJECTIVE FOR SHAREHOLDER VALUE

The goal is to give shareholders a higher total return, total of dividend and increased value, than shareholders in companies with a similar risk profile and business activities.

STRATEGY

In order to achieve its vision and meet its shareholder value objective within the framework of its business concept, JM has the following strategies:

JM shall be the leading project developer of high-quality residential projects in the Nordic countries. "Leading" refers to market position in JM's markets as well as the quality of our product. Development of housing will be made in growth areas with good demographic and socioeconomic conditions over time. A growing population and a good purchasing power trend increase the potential for success in JM's business.

The focus must be clearly on high quality and eco-compliant homes and workplaces with a high customer value and in attractive locations. This presumes constant awareness and understanding of the needs and priorities of our customers. Homes will mainly be sold for private ownership, but may also include rentals. Project development of commercial properties will be limited and primarily support housing development in large projects, where offices may be a natural planning prerequisite.

Continued volume growth will be generated both organically and through acquisitions, with the priority of strengthening the Group's position in existing markets. Growth will be achieved subject to good profitability and a market-leading position. International growth will be approached with caution, while paying attention to the importance of maintaining good control of the operational risk in JM's capital-demanding business.

Production starts will take place in response to guaranteed demand as well as quality assured pre-construction and production. Compliance with JM's "decision gates" is a central requireDIVIDEND TARGET—The average dividend over a business cycle should correspond to 50 percent of consolidated profit after tax.

MARGIN TARGET—Operating margin should amount to 10 percent, including gains from property sales of 1–2 percentage points.

EQUITY RATIO TARGET—The visible equity ratio should amount to 35 percent over a business cycle. To the extent the visible equity ratio and interest coverage are assessed as exceeding the optimal capital structure on a continuing basis, capital will be transferred to shareholders in a form that is appropriate at the time.

Goal	2009	2008	2007
50	542)	0	30
10	7.6	8.9	18.1
35	37	32	39

1) Not including redemption program.

2) Proposed by the Board.

ment, including a sufficient percentage ofreservations and signed contractsforresidential units before starting production. JM will maintain a limited, but efficient production capacity to hedge production costsforthe long-term, though thisstrategy must always be placed in relation to the cost of external production resources.

JM will focus on cash flows and effective utilization of the balance sheet. This will be achieved by maintaining a high rate of startups, implementation and sales of property projects.

ASSETS AND CAPITAL STRUCTURE

JM's ambition is to maintain an optimal composition of assets and capital structure over time, suitable for the company's project development activities.

The building rights portfolio will be optimized continuously with regard to demand, planned production and tied-up capital. Normally, the balance sheet should contain development properties corresponding to about four years' production expressed in number of building rights.

The balance sheet item project properties will mainly consist of residential properties for project development, in the form of conversion to tenant-owned apartments or densification. JM aims to ensure that no fully developed commercial properties remain on the balance sheet; these should be sold following completion.

The item project properties can vary in size due to the cyclical nature of commercial project development and a varying supply of residential properties for sale.

The equity ratio target is a simplified consequence of a more extensive analysis where shareholders' equity has been allocated

to the balance sheet's different asset classes and types of operations, taking assessed operating risk into account.

The internal relationship between the Group's different business risks and asset classes can vary over time, which impacts the level of the optimized debt/equity ratio for the Group. Moreover, capital structure planning also includes long-term considerations other than a pure model-based calculation of a suitable capital structure.

REQUIRED RATE OF RETURN

In order to generate the highest possible shareholder value, JM must have good knowledge of which investments are profitable and achieve the Group's required rate of return. Every investment in a project must therefore generate a return that covers its cost of capital. The investment's cash flow is calculated and discounted on the basis of a required rate of return which amounts to 6.1 to 7.0 percent.

COST OF CAPITAL, SHAREHOLDERS' EQUITY

• • Risk-free return—current assessment of sustainable return on ten-year government bonds is 4 to 5 percent
• • Risk premium—for the risk the investor takes when investing in JM shares, the risk premium is estimated at 5 percent
• • Required rate of return on shareholder's equity (risk-free return plus risk premium) is therefore 9 to 10 percent.

COST OF CAPITAL, BORROWED CAPITAL

• Risk-free return—current assessment of sustainable return on government bonds with a maturity of 2 years, corres-

ponding with an average project time, amounts to 3.5 to 4.5 percent

• • Risk premium paid on loan financing is assumed to be an average of 1.0 percent
• • Tax deduction—since interest expenses reduce the profit on which tax is paid, in reality the interest expense is lower. With a corporate tax of 26.3 percent the interest expense after tax is reduced by 26.3 percent to 3.2 to 4.0 percent.

CAPITAL STRUCTURE

• Debt/equity ratio—JM's target for the debt/equity ratio in the individual projects is to reach an average of 1.0.

New projects' weighted average cost of capital (WACC) therefore amounts to 6.1 to 7.0 percent. This means that the Group's average investments must generate a cash flow after payment of all operating costs and tax, but before interest expense, of 6.1 to 7.0 percent of the basic investment in order to be profitable.

Value Generation through Project Development

Project development involves acquiring vacant or built land, which through new construction or renovation is refined into attractive housing, and in some cases new neighborhoods or commercial premises.

HOUSING

JM is one of the Nordic region's leading developers of housing. Operations focus on new production of homes, with the main focus on expanding metropolitan areas and university towns in Sweden, Norway, Denmark, Finland and Belgium. Project development at JM covers every link in the value chain, from acquisition of land to the sale of the new home. In many cases JM's projects mean creating new residential areas.

JM'S COMPETITIVE ADVANTAGES

Successful project development presumes knowledge and experience of land and property acquisitions, pre-construction and planning processes, as well as production, sales and management. JM has extensive experience in mastering this holistic approach in a way that generates value, particularly through our close relations with our end customers. Since our operation focuses on new production of housing, we can improve our processes while producing high-quality housing.

The projects are often large and complex, such as Järvastaden, which is evolving in Solna, just north of Stockholm City. Other major projects right now are Liljeholmen in Stockholm, Hägernäs Strand in Täby, the Eriksberg area in Göteborg and the Dockan area in Malmö, which are being converted into new neighborhoods. JM has worked with residential project development for 65 years and is a leader in customer focus as well as quality and environmental issues.

COMMON MANAGEMENT SYSTEM

JM has implemented an operations system that is a comprehensive management system designed to ensure common working methods at JM and support efficient control and oversight. The operations system documents JM's processes and established business-critical demands. Based on constant improvements and regular feedback, the system is integral to our structured development initiative.

JM's pre-construction procedures, an important component of the operations system, serve as a guide toward proven, costeffective working methods and material choices in the housing development. JM's most qualified pre-construction managers, project managers and craftsmen have formulated the preconstruction procedures.

PROJECT DEVELOPMENT PHASES

JM's projects usually start with an acquisition of land. JM conducts market surveys regularly to analyze customer preferences with regard to type of housing, design and location.

The processfrom buying the land until the new homes are ready for occupancy always takes several years and begins with a dialogue and collaboration with the involved municipality to determine how the land can be used. Next follows a pre-construction phase in which architects and other consultants are involved. Sales begin and once home buyers have reserved a certain percentage of planned residential units, construction can begin. JM remains involved for approximately two years after occupancy.

GROWTH IN VALUE

The land acquisition and concept phases are very important in project development. Finding land that can be developed for the

Hägernäs Strand is a new neighborhood in Täby by the closed naval air field north of Stockholm.

right price and developing housing that appeal to home buyers are crucial for profitable project development.

Value generation is at its greatest during the planning process, when JM works with the involved municipality to define land use. In this phase the raw land is converted into building rights. Value grows step by step, as land use is defined. Full land value is attained when the detailed plan becomes legally binding and building permits are obtained—a process that can take from one to five years—and the project has been sold to buyers. Property owners can influence the planning process, but it also depends on the municipal planning process and any appeals.

In addition to acquiring raw land, JM also acquires developed properties that can be further developed into attractive homes or modern offices. Here JM creates growth in value through densification, conversion of leasehold into tenant-owned apartments, planned demolition, or conversion and extension.

COMMERCIAL PREMISES

Most of JM's operations involve residential units, but JM also develops commercial premises. Because economic developments have a greater effect on project development of commercial premises than on residential development projects, they are more cyclical in nature.

Attractive locations as well as modern, flexible and effective offices are factors for success when developing commercial projects.

Project development involving commercial premises mainly takes place in the Stockholm region, primarily to support residential development projects. An area under development may need both residential and commercial buildings in order to create an attractive neighborhood. Older residential areas can be densified with homes and associated commercial centers can be modernized.

Developing rental housing is included in JM's commercial operations. When project development is completed, JM usually sells the building or use the fully developed property to trade for new building rights or project properties.

CASH FLOW MANAGEMENT

Efficient cash flow management is essential because of the longterm nature of JM's projects. JM's control systems and processes are structured to support and stimulate an optimal cash flow approach in all project phases and thus achieve maximized value development in the Group. Decisions concerning acquisitions and starting production are crucial business decisions that have a major impact on cash flow and therefore undergo special scrutiny and evaluation.

Land that JM acquires is first reported on the balance sheet as development property. When production begins for each respective project phase, the carrying amount of the property is transferred to the project and included among the project's other production costs. At the same time land ownership is transferred through a sale to a newly formed tenant-owners association, which is invoiced regularly while the project is underway according to an agreed payment plan. The association finances the land acquisition and the construction work with a building loan from the banking system.

SOME RECOVERY

In 2009 demand for newly built homes improved in Sweden and Norway, JM's main markets. JM has therefore concentrated new construction projects to these markets during the year.

In all, JM started construction on 2,150 residential units during the year, compared with about 1,800 residential units the previous year. In Sweden, the number of housing starts totaled 1,791, of which 91 percent were units in apartment blocks and 9 percent single-family homes. Norway had a total of 359 housing starts, 78 percent of which were apartments and 22 percent single-family homes. Residential housing starts include 492 rental units in Stockholm and 48 rental units in Norway, all for external clients.

MARKET FOR HOUSING PRODUCTION IN 2009

The recession and the financial crisis caused a general decline in demand for housing in the Nordic countries in 2009. However, the situation in the Swedish and Norwegian markets improved relatively quickly, where interest rate cuts had an immediate positive impact on housing prices.

SWEDEN

In Sweden construction of both tenant-owned apartments and single-family homes declined in 2009. Tighter credit for both businesses and households had a negative effect on the market. After a few months at the beginning of the year with low confidence in the future and major layoffs, demand for housing rebounded during the spring. Driving forces such as extremely low interest rates, increases in disposable income and signs of a turnaround in the economy strengthened consumer confidence.

TENANT-OWNED APARTMENT PRICES IN SWEDISH METROPOLITAN AREAS OVER THE PAST 10 YEARS

RESIDENTIAL CONSTRUCTION—NUMBER OF HOUSING STARTS

Country	2009	2008	2007
Sweden	16,400	21,700	28,300
Norway	25,800	25,300	34,200
Denmark	9,300	12,400	22,300
Finland	18,900	20,800	26,000

Source: The bureau of statistics of each country, compiled by WSP Analys & Strategi.

The urban regions account for almost all of Sweden's population growth, at the same time that the level of housing production in these areas has remained unchanged over the past 35 years. From an international perspective, Sweden builds relatively few homes in relation to the size of its population. In 2009, 2.3 homes per 1,000 residents were completed in Sweden and the corresponding figure for Europe was 4.1 (in 2008 the figure was 3.6 in Sweden and 5.2 in Europe).

JM's largest segments in Sweden are the metropolitan areas of Stockholm, Göteborg and Malmö/Lund.

NORWAY

Although global financial uncertainty has had its effects, economically, Norway was the strongest country in Europe in both 2008 and 2009. With its large oil reserves, the Norwegian economy is strong and permeated by optimism. After a decline at the beginning of the year, demand for housing increased at the same time that the existing housing inventory was depleted. Just as in Sweden, the increase in disposable income and the low interest rates were the primary drivers. The Oslo region accounted for 50 percent of Norway's population growth over the past five years.

Through its subsidiary JM Byggholt AS, JM is one of Norway's top five residential builders with respect to production of apartments, with operations in the Oslo region, Vestfold, Grenland, Bergen and Stavanger. Some of the larger projects include

NET MIGRATION SWEDEN'S METROPOLITAN REGIONS 1980–2009

Relative net, per thousand of the population

Relative net migration refers to population growth due to relocation (inward migration minus outward migration) in relation to the size of the region. Stockholm is twice as large as the other regions, so these figures are calculated in relative terms.

Ten per thousand refers to population growth of 1 percent only as a result of relocation during the year.

Waldemars Hage in Oslo, Bragenes Strand in Drammen and Stongafjellet outside Bergen.

DENMARK

In Denmark the number of housing starts fell for the third consecutive year in 2009, primarily in the capital city region. The market continues to have clear imbalances and housing inventory is still larger than demand, which has had an adverse effect on housing prices. Disposable household income increased during the year, but unemployment doubled during the same period. Financial participants also build housing in Denmark, where the possibility of buying homes for rental purposes creates an investment market. Consequently the Danish housing market is more affected by the international financial turmoil.

JM concentrates operations to the Copenhagen area and Islands Brygge is one of the biggest projects in the region.

FINLAND

Finland is one of the countries hit hardest by the recession in 2009. Housing construction fell, though the decline was relatively mild thanks to an upswing in construction of homes backed by ARAVA loans (advantageous loans, mainly for rentals). However, the market for owned apartments was weak.

JM became established in the region in 2007 and is active in the Helsinki area.

BELGIUM

Housing construction in Belgium fell in 2009 for the third consecutive year. As part of the stimulus package in response to the financial crisis, VAT on newly built homes was reduced from 21 to 6 percent, which to some extent prevented a further decline in the market.

JM is developing residential units in the Brussels region and in the province of Brabant Wallon. Customers are mainly private individuals, but also include Belgian and international companies and institutions. Home buyers mainly intend to live in the houses themselves, though some purchases are intended for rentals.

JM'S HOUSING STARTS

Market	2009	2008	2007
Sweden	1,791	1,570	3,335
Norway	359	227	638
Denmark*	0	0	48
Finland*	0	0	22
Belgium	0	32	22
Total	2,150	1,829	4,065

* The hibernation strategy for Denmark and Finland, which was adopted in 2008 in response to the low demand, is still in effect

JM'S RESIDENTIAL UNITS IN CURRENT PRODUCTION

	Dec 31, 2009	Dec 31, 2008
Number of residential units in current production1)	3,744	5,118
Percentage sold residential units in current production, %2)	54	45
Percentage reserved residential units in current production, %	25	9
Percentage sold and reserved residential units in current
production, %	79	54

1) Beginning with production startup through final occupancy according to plan 2) Percentage sold residential units expressed as binding contract with end customer

ASSESSED MARKET POSITION IN 2009, RESIDENTIAL HOUSING MARKET, IN CITIES WHERE JM HAS OPERATIONS

	JM's market
Market	position	Major competitors
Sweden	1	NCC, Peab, Skanska and HSB
Norway	Among the top 5	Veidekke, Skanska, Block Watne and Peab
Denmark*	Among the top 5	NCC, Sjaelsø Gruppen, Nordicom, and Arkitektgruppen
Belgium**	Among the top 10	CIB, Thomas Piron, Soficom, Besix, BPI/CFE Atenor and Matexi
Finland	***	YIT, Skanska, NCC and Lemminkäinen Talo
*	Copenhagen region

** Brussels, Namur and Brabant Wallon

*** Operations began in the Helsinki area in 2007

APARTMENT PRICES IN OSLO, COPENHAGEN AND HELSINKI OVER THE PAST 10 YEARS

Source: The bureau of statistics of each country, compiled by WSP Analys & Strategi.

BREAKDOWN OF SALES STARTS, JM'S TENANT-OWNED APARTMENTS BY PRICE BAND, 2005–2009, SWEDEN

BREAKDOWN OF SALES STARTS, JM'S TENANT-OWNED

Hägernäs Strand

New neighborhood in Täby

Hägernäs Strand is a new neighborhood in Täby by the closed naval air field north of Stockholm. Live close to the water, take walks along the beach and enjoy the restaurant, café and shops on the square by the harbor. Each stage has its own architect.

Location: Täby	Remaining number of building
Development period: 2001–2012	rights: 160
Housing type: Apartment blocks	Location: Close to sea and nature
Number of residential units:	Communications: Bus, train
– Total: approx. 800	Distance to downtown Täby: 5 km
– Started: 626
– Housing starts in 2009: 48
Apartment sizes: 55–101 m2 ,
2–5 rooms and kitchen

A new neighborhood in Långbro Park

Långbro Park is located in Älvsjö, southwest of downtown Stockholm. A careful but extensive renewal project is in progress to preserve and improve existing turn of the century buildings and the classic park. The park features a tavern, a school, gym facilities with a swimming pool and the beautiful pond.

Location: Stockholm	Remaining number of building
Development period: 2000–2013	rights: 320
Housing type: Apartment blocks	Location: Park setting
Number of residential units:	Communications: Subway,
– Total: approx. 900	commuter train
– Started: 593	Distance to downtown Stockholm:
– Housing starts in 2009: 0	10 km
Apartment sizes: 66–131 m2 ,
2–5 rooms and kitchen

Northwest Kungsholmen

Housing close to the water on northwest Kungsholmen. New homes and office buildings are being built, while stores, restaurants and other services are opening their doors in the area by the lake Ulvsundasjön.

Location: Stockholm	Remaining number of building
Development period: 2007–2012	rights: 162
Housing type: Apartment blocks	Location: Central
Number of residential units:	Communications: Subway, bus
– Total: approx. 430	Distance to downtown Stockholm:
– Started: 267	3 km
– Housing starts in 2009: 0
Apartment sizes: 43–169 m2 ,
1–5 rooms and kitchen

Liljeholmskajen

A new part of Stockholm's inner city

Cafés,restaurants and shops are gradually opening around the new homes. The urban lifestyle in the natural environment achieves an unusually fine balance. The traditional neighborhood, "Söder" and the rest of downtown Stockholm are just on the other side of the Liljeholmsbron bridge. Stockholm's waterways—Årstaviken, lake Trekanten, and Mälaren by Vinterviken—offer fantastic year round recreation opportunities.

5 km

Location: Stockholm Development period: 2001–2016 Housing type: Apartment blocks Number of residential units: – Total: approx. 3 ,100 – Started: 1,677 – Housing starts in 2009: 313 Apartment sizes: 45–112 m2, 2–5 rooms and kitchen

Remaining number of building rights: approx. 1,400 Location: Central Communications: Subway, bus Distance to downtown Stockholm:

THE COMMUNITY SPIRIT IS AN EXTRA BONUS AT LILJEHOLMSKAJEN

When you enter Lena Sipari's light, modern three-room apartment, it doesn't take long to discover the main reason she chose to live by Liljeholmskajen: the wonderful view of the neighborhood.

"My first choice was actually a different apartment, but today I'm glad it turned out the way it did. I moved into my new apartment in December of 2007 and I still love it here."

The area just gets better and better as it reaches completion. Lena has a daughter and a son, twins Vera and Wilmer, who turned two in February and occupy most of her time. And who also ensure that she has a busy social life with all the other moms in the neighborhood. In contrast to what planners thought in the early stages, Liljeholmskajen has become popular among families with children. New playgrounds, preschools and schools have popped up in the area, along with cafés and restaurants, which Lena missed when she was on maternity leave.

"It's turned out really well and I look forward to the continued development of the neighborhood. One of the things I value with the move to an area with newly built homes is the great sense of community that arises," says Lena. "Everyone moves in at about the same time, with the same thoughts and expectations. People say hi and chat when they run into each other in the elevator or at the store. I really appreciate that."

The apartment at Kajen 1 in Liljeholmskajen is Lena's third JM home.We ask her if it's just pure chance, or if she prefers JM homes to others.

"I feel that JM usually builds in very attractive locations and that the architecture and interiors are appealing. If you're a VIP customer, you avoid the first-come-first-serve principle, which many other construction companies use in their new production." Since Lena has been a VIP customer at JM for a long time, she receives advance information about all new JM projects. That's how she learned that JM would build Kajen 1, right by

From her apartment Lena Sipari can see the boats glide slowly past on Årstaviken, on their journey between the lakes, Mälaren and Saltsjön.

the water at Liljeholmskajen, and immediately reserved an apartment.

Lena reveals that she has received information about JM's single-family home project in Långbro Park with occupancy in 2011. When it's time to move to a larger home it will probably be to a single-family home.

"The houses really appeal to me, with the small, easy-care yards bordering the park. But it will be hard to leave Liljeholmskajen, with its proximity to downtown attractions and excellent communications. It only takes ten minutes on the cross-town line to my job, and the children's day care center is right next door.

"You never stop being fascinated by the view here—the boat traffic and the rest of the neighborhood. Another advantage of my apartment is that it's so private; only the seagulls flying past can see what we're doing."

Garden town with an urban feel, close to downtown

Järvastaden is a new neighborhood close to the Igelbäcken nature reserve in Solna and Sundbyberg. JM offers modern housing in apartments or singlefamily homes. The combination of beautiful scenery and central location make Järvastaden a unique neighborhood.

Location: Solna and Sundbyberg	Remaining number of building
Development period: 2007–2016	rights: 800
Housing type: Single-family homes/	Location: Close to nature and
Apartment blocks	Stockholm city
Number of residential units:	Communications: Commuter train
– Total: 1,070	Distance to downtown Stockholm:
– Started: 301	8 km
– Housing starts in 2009: 69
Apartment sizes: 48–112 m2 ,
2–5 rooms and kitchen

Dockan—where the city meets the sea

In the middle of the Öresund region, Dockan is located in a historic section of Malmö. An area that showcases the new Malmö, adapted to both European companies and Nordic living. A unique location, close to the city and with a view of the Öresund sound has made Dockan one of the most popular places to live.

Remaining number of building
rights: 315
Location: Close to city center/by
the sea
Communications: Bus
Distance to downtown Malmö:
0.5 km

Uppsala's entrance to the south

The expansion of central Uppsala continues. Pleasant city blocks feature space and light. Natural features are enhanced in various situations, with rooftop terraces or small gardens.

Location: Uppsala	Remaining number of building
Development period: 2002–2015	rights: 520
Housing type: Apartment blocks	Location: Close to city center
Number of residential units:	Communications: Bus
– Total: approx. 1,000	Distance to downtown Uppsala:
– Started: 472	0.7 km
– Housing starts in 2009: 51
Apartment sizes: 42–111 m2 ,
1–4 rooms and kitchen

Västra Sannegårdshamnen

The city by Norra Älvstranden

Västra Sannegårdshamnen has become one of the most popular neighborhoods in Göteborg. The feeling of being close to the sea enhances quality of life and you'll find everything you need right there in the neighborhood. At Norra Älvstranden, housing, culture and workplace combine to form a living urban environment.

Location: Göteborg	Remaining number of building
Development period: 2002–2011	rights: 0
Housing type: Apartment blocks	Location: Close to water
Number of residential units:	Communication: Bus, boat
– Total: 461	Distance to downtown Göteborg:
– Started: 461	5 km
– Housing starts in 2009: 0
Apartment sizes: 42–164 m2 ,
1–5 rooms and kitchen

New neighborhood for people who enjoy life

A whole new neighborhood is evolving at Öster Mälarstrand. The area that was once used for winter boat storage and other marine activities will now be transformed into a modern residential area right by the shores of lake Mälaren.

Location: Västerås	Remaining number of building
Development period: 2008–2018	rights: 420
Housing type: Apartment blocks	Location: Central
Number of residential units:	Communications: Bus
– Total: approx. 480	Distance to downtown Västerås:
– Started: 56	2 km
– Housing starts in 2009: 28
Apartment sizes: 57–107 m2 ,
2–4 rooms and kitchen

Waldemars Hage

Urban area by the river

Waldemars Hage has secured its position as an attractive residential neighborhood that is close to everything. The project is located along the Akerselva River in popular Grünerlökka, Oslo.

Location: Oslo, Norway	Remaining number of building
Development period: 2005–2011	rights: 0
Housing type: Apartment blocks	Location: Central by Akerselva river
Number of residential units:	Communications: Trolley, bus
– Total: 264
– Started: 264
– Housing starts in 2009: 0
Apartment sizes: 31–94 m2 ,
2–4 rooms and kitchen

problem-FREE LIVING

JM aspires to be the customer's first choice when buying a new home—where a focus on the customer and sensitivity to our customers' needs are crucial factors for success. Buying a JM home should be as simple, secure and convenient as living in one.

SMART KVADRAT

During 2009 we decided to summarize our offering under the "Smart Kvadrat," or "Smart Square" concept. This means so much more than not having to trip over the kids' toys, or finding winter scarves and mittens in the right drawer. For us, smart kvadrat represents an approach that focuses on carefully thought through and well-planned homes.

From the time that a new residential area is just a concept in our minds, until the customer moves in and can begin to enjoy a new life—with all that this entails in climate-smart thinking, financial security and room for different personalities.

BUILD WHERE PEOPLE WANT TO LIVE IS SMART

Home buyers should not just enjoy living in their new homes; the neighborhood is also important. That's why we build all of our homes in attractive locations, close to public transportation and good infrastructure, where the streets, lawns, playgrounds and other amenities are ready when customers move in.

OFFER WELL -PL ANNED SOLUTIONS IS SMART

In JM homes, everything is brand new and in top condition right from the start. JM Original is standard in all homes as a carefully selected interior, yet with room for personal expression. Our interior design guides, customized for each residential area, make it easy for the customer to be a part of the process and influence the final result.

EXAMPLE OF INTER IOR STYLE

MO DER N URB AN

A big-city style, clean and pared back with an exclusive image.

MATER IALS AND COLOR S

Understated color palette, chrome. Stainless steel, glass, diabase, leather. Black, white, grey, greyish-brown, metallic, matte vs high-gloss and textured materials.

BUILDING ECOFRIENDLY HOMES IS SMART

JM only builds low-energy houses, with features such as extra insulation in the floors, walls and roof. Of course our climatesmart, energy-efficient construction practices also apply to the windows. They are coated with a special layer that reduces heat loss—and the customer's energy costs. Our customers also appreciate the fact that our homes have individual hot water meters, which means they only pay for their own consumption.

And in general, sound and proven natural materials are the obvious choice in JM homes. No allergenic materials are used.

BUILDING SECURITY INTO THE NEW HOME IS SMART

For many people, buying a home is the biggest transaction of their lives. Since 2009, JM has offered a security package, including insurance against double housing costs and access protection, where the customer may postpone occupancy by up to three months if this is not possible for any reason on the designated date.

SIX NEW INTER IOR STYLES

As part of its quality assurance procedures for JM homes, in 2009 JM identified six interior styles for standard interiors in the residential projects, based on knowledge of JM's target groups and awareness of future trends.

These are the different styles: Trend Contemporary, Trend Retro, Modern Urban, Natural Genuine, Classic Rustic and Classic Poetic.

THE MOST SATISFIED CUSTOMER S IN THE INDUSTRY

An important part of JM's development and quality improvement efforts involves continuously working to learn more about who our customers are and what they want in a home.

We conduct regular customer surveys in our residential projects during both the planning stage (Early Customer Survey) and for evaluation purposes (Customer Satisfaction Index), both when the customers move in and in connection with the guarantee inspection.

In addition, parallel customer surveys are carried out with respect to specific themes based on different areas of focus. JM's Open House Days are an important tool for planning and execution. We carefully monitor what happens in our society and the market in general. We believe that the ability to identify and understand changes in society and their significance for housing, work and lifestyle are crucial success factors for our business.

Satisfied customers are the most important key to success. In 2009 JM improved the customer evaluation survey method to gain even better insight into how well customers feel JM is doing in different parts of the operation and how these parts affect them with respect to total customer satisfaction.

In 2009, for the first time the new housing market in Sweden has an industry index. The results show that JM has the most satisfied customers in the industry. The Customer Satisfaction Index for JM in Sweden for 2009 was 72, compared with the industry index of 70. There is some distribution among the JM companies, where Seniorgården customers are absolutely the most satisfied, with a Customer Satisfaction Index of 80.

DEVELOPME NT OF JM'S WEB SITES

During 2009 JM took additional steps toward the goal of a uniform appearance for all external JM Group websites. The most recent contributions to the conversion came in autumn 2009 when the new versions of JM in Finland and JM Entreprenad Web sites went public.

VIP

VIP customers at JM learn about when, where and how we will build new homes before they are released for general sales. VIP customers receive regular newsletters with the latest residential projects, along with priority access to JM's projects in Sweden. Being a VIP customer costs SEK 200 per year.

Interest for, and the influx of, new VIP customer was lower in 2009 than in 2008, especially during the first half of the year, due to the limited number of new residential projects. The total number of VIP customers increased during the year by about 2,800.

PERCENTAGE OF JM'S BUYER S WHO ARE VIP CUSTOMER S

2009	2008	2007	2006	2005
27%	34%	26%	19%	9%

Of those customers who moved in during 2009, 27 percent were VIP customers.

JM's customer magazine entré received the 2009 Sweden Publishing Prize for customer newsletter of the year in the House & Home category. The magazine is sent home to VIP customers in Sweden four times per year.

JOINT OPE N HOUSE DAYS

Five open house days were held in 2009: one during the holiday season at the beginning of the year, two in the spring and two in the autumn. The Big Open House Day is a regular event during which all JM residential projects are open to the public on the same day.

"Despite the uncertainty in the housing market, interest in the open house days was strong throughout the year."

The open house day theme during the spring was garden and balcony, while we focused on storage during the autumn. In response to a market survey carried out among JM's VIP customers, the model homes also presented customer requests and expectations regarding storage solutions, and how JM has solved these issues.

Despite the uncertainty in the housing market, the open house days were popular throughout the year, with a visitor count of about 2,000 people per open house day. Open house days attract many new potential buyers. On each JM open house day the majority of visitors (over 55 percent) have never been to a JM open house before.

The open house days are evaluated through questionnaires given to visitors at the respective residential projects and overall, the results have been very positive. Over 70 percent of visitors state that the visit increased their interest in buying a JM home in the future.

Yet another new feature during the year is that JM's model homes in Sweden were open throughout the summer and brought many new customers in an otherwise cautious market.

The open house schedule is available on JM's website www.jm.se and by mobile phone at mobil.jm.se.

CUSTOMER ADVOCATE

Customers in Sweden who feel they have been wrongly treated by one of JM's representatives can turn to JM's Customer Advocate. The Customer Advocate works for JM, examines customer complaints about projects and mediates, when needed, between the customer and JM's representative.

Resid entia l bui lding rights provid e good prospects

JM continuously invests in land that can be developed for future production and have 27,900 building rights available (31,000). The geographic distribution of building rights is as follows: 38 percent in Greater Stockholm, 37 percent in the rest of Sweden and 25 percent in Norway, Denmark, Finland and Belgium.

The available building rights portfolio includes two types of building rights: building rights on the balance sheet, about 18,400 (20,100), and building rights that are available through conditional acquisitions or cooperation agreements, about 9,500 (10,900). Building rights made available through conditional acquisitions or cooperation agreements are not recognized on the balance sheet. In most cases JM has the opportunity to decide both whether and when to buy the land.

Capital tied up in building rights (development properties in the balance sheet) for residential units totaled SEK 4,882m (5,540) at the end of the year.

GOO D COMPO SITION

JM's planned residential units are located in both traditionally strong housing markets and in new emerging markets.

Many of our planned residential units satisfy home buyers' demands for good communications, and a location close to water, service and schools.

Rising housing prices have led many prospective buyers to look for homes farther away from the big cities. Improved communications have also made it possible for people to accept longer commutes. This expansion of urban regions has made new housing markets attractive.

NUMBER OF RESIDENTIAL UNITS AT DIFFERENT

At year-end 2009/2010, external appraisal companies performed a valuation of all JM's residential development properties in cooperation with JM. The appraisals are made based on an assumed sales price for the properties at actual cash values, whereby future development gains are not taken into account. The valuations are based on the location, attractiveness, scope and type of building planned, the stage in the planning process and the time remaining until production starts.

The assessed market value of JM's residential development properties amounts to SEK 6.8bn (7.2). The corresponding book value is SEK 4.9bn (5.5). The approximately 9,500 residential units available through conditional acquisitions were not included in the assessment.

JM's avai lable resid entia l bui lding rights

Area	Number of building rights
Greater Stockholm excluding Sigtuna, Vallentuna,Norrtälje	10,700
Malmö/Lund/Helsingborg/Halmstad	3,600
Greater Göteborg including Linköping, Jönköping	2,700
Uppsala including Sigtuna, Vallentuna, Norrtälje, Västerås, Örebro	3,900
Oslo Region, Bergen, Stavanger	4,800
Greater Copenhagen	900
Helsinki	300
Brussels	1,000
Total (approx.)	27,900

Market va lue is broken down as follows :

SEKbn	Market value	Carrying amount
Stockholm	3.2	2.1
Rest of Sweden	1.9	1.5
International	1.7	1.3
Total	6.8	4.9

Some of the development properties have old existing buildings that generate operating net with future plans for renovation or

NUMBER OF RESIDENTIAL UNITS AT DIFFERENT Number of PLANNING PHASES, REST OF SWEDEN

Liljeholmskajen, a new part of Stockholm's inner city.

demolition. The valuation of these buildings is based on current rental revenue and future use, taking costs for essential conversion and extension into account. The market value of these buildings is included in the above summary.

Appraisal companies have classified the phases of the planning process into the following phases; raw land, general plan, detailed plan and building permit. The diagrams show a breakdown of the value of JM's development properties into different planning phases.

The detailed planning phase covers the period from the start of detailed planning work until application for a building permit.

MARKET VALUE, RESIDENTIAL BUILDING RIGHTS,

MARKET VALUE, RESIDENTIAL BUILDING RIGHTS, INTERNATIONAL

Property development su pports th e housing busin ess

JM's project development of senior housing, rental units and commercial premises is mainly concentrated to Greater Stockholm. Its purpose is to support the housing business.

RESIDENTIAL PROPER TIES

Real estate companies and investors showed somewhat stronger interest in buying toward the end of 2009, though they still lagged well below normal levels because of the financial turmoil on the credit market. The greatest interest came from domestic investors and pension funds.

During the year five rental properties from JM's stock south of Stockholm, by Gullmarsplan and Johanneshov, were sold after being restructured as tenant-owned apartments. The properties consisted of 134 residential units with a total area of 7,694 square meters and the buyers are four newly formed tenant-owners associations. Construction began in 2009 on the "Markan" rental project in Hägernäs, Täby, which was sold in December 2009 to Heba Fastighets AB. This property consists of 52 rental units in four separate buildings with a total area of 2,848 square meters. We are actively looking for land allocated for rental housing in the Greater Stockholm region.

Two special housing facilities for the elderly were sold in the autumn of 2009. The Lillängen project in Nacka, where construction began in 2007, with a total useful floor area of 2,685 square meters and 45 apartments, was sold to Diligentia. The Ymerplan project in Sigtuna, where construction began in 2008, with a total useful floor area of 5,400 square meters and 72 apartments, was sold to KPA.

In the spring of 2009 construction began on the Solbacka project for special housing for the elderly in Norrtälje, with 64 homes and total area of 4,368 square meters. The municipality signed a lease and occupancy is expected in the summer of 2010. The detailed plan proposal to Lidingö Municipality includes special housing for the elderly within the planned area in Dalénum. The detailed plan is expected to gain legal force in late 2010.

JM's subsidiary Seniorgården is constantly analyzing the needs of the municipalities for senior housing and looking for land allocated. JM is also monitoring developments concerning the new type of housing for the elderly, sheltered housing.

0 100 200 300 400 500 600 700 800 2007 2008 2009 JM'S PROPERTY SALES* Capital gains Carrying amount 471 182 675 73 89 SEKm *) Pertains to project and development properties

1. In the Central Business District (CBD) rent fell five percent compared with the fourth quarter of 2008, from SEK 4,100 per square meter to SEK 3,900 per square meter. Compared with the peak in the third quarter of 2008, rent fell eleven percent. In other markets, rent dropped an average of five to ten percent, with the least variation in the downtown area (excluding. CBD). Source: Jones Lang LaSalle Nordic City Report, autumn 2009.

It has been ten years since the transaction level in Sweden was as low as it was during the first half of 2009—down 80 percent compared with the corresponding period in 2008. Activity from foreign investors decreased sharply, accounting for only 17 percent of business deals carried out during the above period. The market recovered, albeit marginally, in the third and fourth quarters of 2009 when several large deals were completed. Source: Newsec Property Report, autumn 2009.

Buyers are interested in modern, new construction or renovated properties. Buildings in prime locations in the city center or in attractive inner suburbs that have tenants with long leases are also attractive on the market.

In December JM moved, according to plan, into its new headquarters in Frösunda, Solna. Vasakronan owns the building and ordered the construction project. This occupancy marked the conclusion of the deal from 2006 when JM signed an agreement with Vasakronan for the sale of office buildings and office building rights in Frösunda. The new headquarters complies with JM's guidelines for energy saving and meets the GreenBuilding Standard.

In the Dalénum area AGA's new headquarters was completed, with occupancy during the summer. The premises are located in traditional old industrial buildings that were converted into modern offices. The 10-year lease covers about 8,000 square meters. According to the detailed plan proposal, after demolition there will remain more than 42,000 square meters of commercial premises and about 1,000 homes, including 200 rental units.

COMMER CIAL PROPER TIES

Commercial rent fell throughout the Stockholm market during

Other than a few small properties that JM has for its own use, its portfolio contains no fully developed properties. The property portfolio consists entirely of project properties.

		Dec 31, 2008
Ma rket va luati on— project properti es	Market value, SEKm	Carrying amount, SEKm	Area (000) m²	Occupancy rate annual rent, %	Carrying amount, SEKm
Residential units (rental units)	-	-	-	-	137
Properties under development	566	558	63	89	410
Fully developed commercial properties	44	38	3	91	67
Total	610	596	66	89	614

JM Resid entia l Stockh olm

MARKet

Demand for homes on the existing home market continued to strengthen during the year. The improved market has also meant increased interest for JM projects, with solid sales over the past few quarters. The supply of new homes is not large enough to meet long-term demand in the Stockholm area.

JM is the market leader in new production of tenant-owned apartments in Greater Stockholm, with ongoing projects in several municipalities in the county. Some of the larger projects in the region include Långbro, Liljeholmen/Årstadal, Kojan/Västra Kungsholmen, Fågelviken/Örnsberg, Järvastaden/Solna/Sundbyberg, Norra Frösunda/Solna and Hägernäs/Täby.

The Stockholm and Malmö regions have grown most over the past decade in terms of population. Unlike many other regions, in 2009 the upswing in unemployment was relatively low in Stockholm, which still serves as Sweden's major growth engine.

earnings trend

The business segment's income fell to SEK 3,330m (5,317) and operating profit dropped to SEK 496m (920), including property sales of SEK 2m (-). The operating margin was 14.9 percent (17.3). The reduction in operating margin is attributable to the lower price level in the projects and the decreased project volume. Costs for completed staff cutbacks during the year were lower than expected, which had a positive effect on the result of about SEK 25m during the fourth quarter. Cash flow has been in balance during the year, in part due to a low level of investments in development properties.

BUILDING RIGHTS

During the year building rights equivalent to more than 120 (900) residential units were acquired in Järfälla, Stockholm and Täby.

HOUSING STARTS

During the year production began on 1,102 (973) residential units, including 729 in Stockholm, 139 in Solna/Sundbyberg, 134 in Täby, 70 in Järfälla and 30 in Värmdö.

Nature and boating give Bolinder Strand, by lake Mälaren, its special personality.

JM resid entia l Stockh olm

The JM Residential Stockholm business segment develops residential projects in Greater Stockholm. Operations include acquisitions of development properties, planning, pre-construction, production and sales of residential units.

	January–December
SEKm	2009	2008
Income	3,330	5,317
Operating profit 1)	496	920
Operating margin (%)	14.9	17.3
Average operating capital	1,981	2,012
Return on operating capital (%)	25.0	45.7
Operating cash flow	544	1,090
Carrying amount, development properties	2,111	2,432
Number of available building rights	10,700	12,200
Number of residential units sold 2)	1,713	1,061
Number of housing starts 3)	1,102	973
Number of employees	635	910
1) Of which —property sales	2	-
—write-downs on properties	-	–140
2) Of which rental units	562	-
3) Of which rental units	492	-

Järvastaden in Solna/Sundbyberg.

JM Resid entia l Sweden

MARKet

Demand for homes on the existing home market is good. Interest in JM projects continues to grow, as does customers' willingness to sign contracts, resulting in good sales over the past few quarters.

JM's largest segments in JM Residential Sweden are Göteborg and Malmö/Lund.

JM's major projects in the Göteborg region include the former harbor area at Norra Älvstranden in Göteborg, where JM is building in Sannegårdshamnen and the Juvel area. Outside Göteborg JM has large projects in Kungsbacka and Kungälv. The Göteborg region is the urban area in Sweden affected most negatively by the recession. Nevertheless, despite rapidly climbing unemployment, housing prices rose in 2009.

The largest JM projects in the Malmö region can be found in the former harbor areas: the Dockan area in Malmö and Lomma Hamn outside Malmö. The Malmö region is the Swedish metropolitan area that has seen the largest increase in prices (in terms of percent) in the housing market in recent years. The region continues to have strong prospects for developing in a positive direction, with a differentiated industrial structure and positive performance in several growth industries.

earnings trend

The business segment's income fell to SEK 2,296m (3,263) and operating profit fell to SEK 166m (197). The operating margin increased to 7.2 percent (6.0). The increased operating margin is attributable to the improvement in demand. Cash flow is limited to some extent by the lead time in the financing process and because projects were started late in the fourth quarter.

BUILDING RIGHTS

During the year building rights equivalent to more than 400 (1,600) residential units were acquired in Malmö, Lund, Göteborg, Jönköping and Uppsala.

HOUSING STARTS

During the year production began on a total of 689 (597) homes: 570 (525) were residential units in apartment buildings, including 217 in Skåne (70 in Malmö, 60 in Lomma, 32 in Lund, 35 in Helsingborg, 20 in Halmstad), 80 in Göteborg, 32 in Jönköping, 49 in Linköping, 55 in Västerås, 102 in Uppsala and 35 in Vallentuna. Production started on 119 (72) single-family homes, including 101 in Skåne (82 in Lund, 19 in Staffanstorp) and 18 in Linköping.

JM resid entia l sw eden

The JM Residential Sweden business segment develops residential projects in growth areas in Sweden, excluding Greater Stockholm. Operations include acquisitions of development properties, planning, pre-construction, production and sales of residential units. Contracting operations are also conducted to a limited extent.

	January–December
SEKm	2009	2008
Income	2,296	3,263
Operating profit 1)	166	197
Operating margin (%)	7.2	6.0
Average operating capital	1,597	1,447
Return on operating capital (%)	10.4	13.6
Operating cash flow	70	–203
Carrying amount, development properties	1,451	1,546
Number of available building rights	10,200	11,000
Number of residential units sold	973	564
Number of housing starts	689	597
Number of employees	459	618
1) Of which—property sales	0	–1
—write-downs on properties	-	–40

The Dockan area in Malmö offers city living by the sea.

JM Int ernati ona l

earnings trend

The business segment's income fell by 34 percent to SEK 1,353m (2,058). Operating profit fell to SEK –192m (–176) and operating margin was –14.2 percent (–8.6). The reduction in operating margin is attributable to the lower price level in the projects and the decreased project volume. The improvement in sales is attributable to the Norwegian business.

The hibernation strategy in Denmark and Finland has had a negative impact on financial performance due to the limited project volume.

norway

Demand for newly built homes and for homes on the existing home market continued to strengthen during the year. Prices in the existing home market continued to show a rising trend.

During the year 502 residential units (136) were sold and production began on 359 (227) units.

No acquisitions were made during the year. Available building rights correspond to about 4,800 residential units (5,750).

denmark

The Copenhagen housing market is characterized by low activity and some stabilization of demand during the second half of the year. Housing prices have been falling for an extended period of time, but they now appear to have stabilized. Banks continued their restrictive lending practices, which offset the positive effect of lower interest rates.

Write-downs of a total of SEK 87m for three development properties in Copenhagen have had a negative impact on JM Denmark's financial performance.

During the year 63 (64) residential units were sold and production began on 0 (0) units. JM Denmark had no current production at year-end. Production in one large project in central Copenhagen (Egholm) of a total of 165 homes concluded at the end of the second quarter. As of December 31 the project had 56 unsold units recognized on the balance sheet at a value of SEK 185m.

No acquisitions were made during the year. Available building rights correspond to about 900 residential units (900).

finland

Activity on the housing market in Helsinki was very low during 2009. The number of completed and unsold units in the market decreased during the year from a high level.

No residential projects are currently in production and JM has no unsold, completed homes.

During the year 12 residential units (10) were sold and production began on 0 (0) units.

No acquisitions were made during the year. Available building rights correspond to about 300 residential units (300).

belgiu m

In the Brussels region, where JM has its operations, activity in the industry slowed during the second half of the year due to

JM int ernati ona l

The JM International business segment develops and sells residential properties in Norway, Denmark, Finland and Belgium.

Income	Number of employees
	January–December
SEKm	2009	2008
Income	1,353	2,058
Operating profit 1)	–192	–176
Operating margin (%)	–14.2	–8.6
Average operating capital	1,936	1,800
Return on operating capital (%)	–9.9	–9.8
Operating cash flow	–174	–657
Carrying amount, development properties	1,320	1,562
Carrying amount, project properties	32	61
Number of available building rights	7,000	7,800
Number of residential units sold 2)	605	246
Number of housing starts 3)	359	259
Number of employees	240	278
1) Of which—property sales	12	-
—write-downs on properties	–87	–140
2) Of which rental units	48	-
3) Of which rental units	48	-

increased uncertainty in the housing market.

During the year 28 residential units (36) were sold and production began on 0 (32) units.

No acquisitions were made during the year. Available building rights correspond to about 1,000 (850) residential units.

Waldemars Hage in Oslo, Norge.

JM Property Development

EARNINGS TRE ND

The business segment's income during the year was SEK 309m (213) including rental revenue of SEK 60m (108) and contracting revenue of SEK 249m (105). Operating profit rose to SEK 110m (75). The increase is mainly attributable to higher contracting revenues.

Contracting revenues from production amounted to SEK 63m (19). Net operating income for project properties was SEK –6m (14). Gains from property sales totaled SEK 75m (74), including a withdrawal from a provision for earlier property sales of SEK 28m (5).

PROPERTY TRANSACTIONS

During the year five rental properties in Stockholm, with a total of 134 residential units, were sold to newly formed tenant-owners' associations with a combined purchase price of SEK 156m and gains of SEK 16m.

Two projects for special housing for the elderly, Lillängen in Nacka Municipality and Ymerplan in Sigtuna Municipality, with a total of 117 residential units, were rented and sold with a combined purchase price of SEK 209m and gains of SEK 27m.

In Täby Municipality the rental property "Markan 6" was sold for SEK 85m, with gains of SEK 4m.

PROJECT DEVELOPME NT

Construction of JM's new headquarters in Frösunda, Solna was completed in December. JM Entreprenad was the contractor. At the same time Vasakronan took over as landlord and JM as tenant. Once Vasakronan took occupancy, JM received the final payment for the completed contract, resulting in a positive cash flow of SEK 375m during the fourth quarter. The new headquarters complies with JM's guidelines for energy saving and meets the GreenBuilding Standard.

In the spring construction began on the Solbacka project for special housing for the elderly in Norrtälje Municipality, with 64 homes and total area of 4,368 square meters. Norrtälje Municipality is the tenant and occupancy is expected in the autumn of 2010.

Construction of the Ymerplan project for special housing for the elderly in Sigtuna Municipality, with 72 homes, is proceeding according to plan. The tenant, Sigtuna Municipality, will take occupancy in March of 2010. The property was sold to KPA in November.

The 45-unit Lillängen project for special housing for the elderly in Nacka Municipality was completed during the year, with Carema AB as tenant. The property was sold to Diligentia in November. Occupancy was in April 2009.

Construction began during the spring on the Markan rental project in Hägernäs, Täby. The project consists of 52 rental units in four separate buildings with an area of 2,848 square meters. The property was sold in December to Heba Fastighets AB. Occupancy is expected in March of 2010.

JM property development

The JM Property Development business segment develops residential and commercial properties in Greater Stockholm. The business segment's entire portfolio comprises project development properties.

In the Bolinder Strand area, Järfälla, development of commercial facilities adjacent to JM's residential project is making progress. Several new rentals and expansion projects of about 1,000 square meters were carried out during the year, resulting in an occupancy rate of 84 percent at year-end.

In the Dalénum area on Lidingö, which was acquired at the end of 2007, detailed planning is in progress. The plan is expected to gain legal force at the end of 2010. After renovations and tenant adjustments, mainly for AGA's new headquarters, the occupancy rate in the existing portfolio was 89 percent at year-end.

BUILDING RIGHTS

JM's building rights for commercial project development amount to a total of about 74,000 square meters, including 54,000 square meters in office building rights. Residential building rights for rental housing account for 16,000 square meters and special housing for the elderly accounts for 4,000 square meters, in the Dalénum area, assuming that the proposed detailed plan is approved. The carrying amount is SEK 108m.

JM Producti on

market

Demand on the contracting market in Stockholm has declined and competition for projects continues to be intense. The house construction market is generally weaker than the civil engineering market, where clients come from the public sector to a greater degree.

earnings trend

The business segment's income was SEK 2,008m (2,008) and operating profit was SEK 130m (124). The operating margin was 6.5 percent (6.2).

PROJECTS

During the year the business segment received several major projects, including construction of a school in Sollentuna Municipality, conversion of offices into homes for Locum on the Karolinska hospital campus and three new phases for Söderenergi for construction of the new cogeneration plant in Södertälje. A large internal project involves new production of rental units in Täby for JM Property Development. A contracting project for Storstockholms Lokaltrafik (SL —Stockholm Public Transport) involves preliminary planning and land sales within the Ekobacken area, in Värmdö Municipality, and an expansion of tramways in central Stockholm will be carried out for SL. Other projects include renovation of Gamla Riksarkivet (Old National Archives), Riddarholmen, for Statens Fastighetsverk (the National Property Board).

Extensive ongoing projects include the conversion of commercial property in Kista for Fastighetsbolaget Klövern, excavation and development projects at Henriksdalshamnen in Hammarby Sjöstad for the City of Stockholm and new construction of a commercial building in Kista for Vasakronan.

Major projects during the year that are now completed include

JM Producti on

The JM Production business segment carries out construction work for external and internal customers in the Greater Stockholm area.

construction of new offices in Frösunda, Solna, where Vasakronan is the final buyer, as well as conversion of the commercial property in the Dalénum area in Lidingö, both for JM Property Development. Another major project involved the refurbishing of and addition to a commercial property in Solna for Fabege.

JM's new office building in Solna was developed by JM Property Development and built by JM Production.

Construction work was carried out at Igelsta Kraftvärmeverk in Södertälje.

RESPO NSIBILITY TO BE A LE ADER IN ENVIRO NME NTAL ISSUES

JM's work helps to create sound communities for the people of today and tomorrow; the houses JM builds today will last for at least 100 years. As a leading residential developer, JM also has a responsibility in the environmental field.

The energy consumption of the houses is constantly in focus since climate change is the major challenge of our time. Consequently, JM focuses on reducing energy consumption and energy needs both during construction and operation. As a homebuilder, we carry a heavy responsibility with respect to the environment for future generations.

THE ENVIRO NME NT: A TOP PR IOR ITY

The construction industry is responsible for a significant part of society's consumption of energy and materials, which has a large impact on the environment. For JM, sustainable urban planning involves financial as well as social and environmental accountability. We aspire to achieve the obvious: to create safe, attractive housing, use ethical business methods and place equivalent demands on our suppliers.

The most important aspect of sustainability for JM involves environmental initiatives, because that is where the company has the greatest impact on society in its role as a residential developer. This section describes JM's residential development projects in Sweden, unless stated otherwise.

ENER GY

For years, JM's most important environmental objective has been to decrease energy consumption and its impact on to climate change. JM has become the European leader in building energyefficient housing—based on the entire production process, not just the individual pilot project.

All residential planning that JM has initiated in Sweden since 2008 has been based on JM's low-energy housing concept. JM defines low-energy houses as houses that meet the authorities' energy requirements during operation with a substantial margin.

JM's environmental priorities, the areas in which JM affects the environment most and that is the focus of our environmental initiatives, are:

• Energy use
• Choice of building materials
• Construction waste management
• Use of transports and construction machinery
• Handling of contaminated soil.

EXAMPLE S OF FEATURE S OF JM'S LO W-ENER GY HOUSES

• Extra insulation in the walls
• More energy efficient windows
• Heat recovery from ventilation
• Individual hot water meters.

The aspiration is for all of the company's homes, in all construction, to have the most energy efficient building shell in the industry (building shell refers to the walls, window, roof and flooring of the house). The requirement in the National Board of Housing, Building and Planning's Building regulations is for 110 kWh of energy consumption measured per square meter and year, excluding household electricity. When all production complies with JM's low-energy standards, JM's residential units will meet this requirement with a good margin, with average energy consumption expected to be 75 kWh. The first low-energy houses were completed and occupied in the autumn of 2009.

JM continues to dedicate resources to make the houses even more energy efficient by continually testing new solutions to learn more and, by extension, improve our low-energy house concept. One such development project is Presse Park in Kungsbacka, south of Göteborg, where JM built two twostory houses with extra insulation. The homes are heated using a preheated air intake system and the houses do not have any radiators. Occupants moved into the houses during the year and we will monitor energy consumption and compare it with two reference projects built using more conventional techniques. Similar house are now being built in Valla, Linköping.

In 2006 JM presented its project with 16 energy-efficient town homes in Järingegränd, located in Tensta, north of Stockholm. The objective at that time was to reduce energy consumption by 30 percent compared with traditional new residential construction. The overarching goal of the project was to show that it is possible to build low-energy houses that are profitable for the customer, the company and the community, and that are also good for the climate. JM also wanted to include solutions in these houses that the company could then incorporate in the future into its regular housing projects. The modified technological solutions were to be based on known and well-proven technology. In addition, neither the comfort nor the appearance of the houses was to be compromised. The problem with building low-energy houses is not primarily a technical problem, but an economic challenge. Now, about three years later, measurements show that the goal has been met by a wide margin: energy consumption has been cut in half and in some cases down toward one third. Lund Institute of Technology carried out the technical monitoring and assessment. This study also shows how important the behavior of the residents is for energy consumption. Several of the solutions tested in Järinge are now the JM standard throughout Sweden.

ENERGY USE EXCLUDING HOUSEHOLD ELECTRICITY, VALUES MEASURED DURING ONE YEAR

A-house: Ventilation system with heat pump B-house: Ventilation system with heat exchanger + heat pump Requirement in National Board of Housing building regulations: 110 kWh/m2

During the year JM moved to its new headquarters, which was developed by JM Property Development and built by JM Production. The office meets the requirements for GreenBuilding Certification. JM has decided that all new commercial properties built by JM will comply with the GreenBuilding Standard, which requires energy consumption to be at least 25 percent less than the building standard.

JM is also working proactively to reduce energy consumption during production. In Sweden, JM only purchases eco-electricity (currently hydroelectric energy, which meets environmental standards). Moreover, during 2009 JM took additional energy efficiency measures within the frame of the "energy-efficient worksites" project. In the future new establishments will be equipped with energy-efficient sheds, low-energy lighting (with light and motion-detectors), and early startup of district heating to heat the house frames during construction. When these measures are implemented at all worksites JM expects energy savings on the order of 9,000 MWh/year.

LOW-ENER GY HOUSES— BJÖRKBACKEN IN VALLE NTUNA

Ulf Nilsson and Jane Dampawon have moved in at Björkbacken in Vallentuna, north of Stockholm. Their decision to buy a newly built JM home gradually evolved:

"We had chosen the area for family reasons. We looked around a little and the idea of owning a brand new apartment was appealing. We can be sure that everything is brand new and will last," says Jane.

When the couple first started hunting for an apartment, a good environmental choice was important, but it was not at the top of the list. JM's ambitious environmental program was a positive experience.

"Since we moved in we've received a lot of information about energy consumption. Being able to influence consumption means we can also lower our costs," says Ulf.

JM'S MO ST IMPOR TANT CLIMATE INITIATIVE

MORE ENER GY EFFICIENT WINDOWS

The space between the panes in the window is filled with the rare gas argon, which makes the windows even more energy efficient.

BETTER WALL S

The walls have a new and more effective insulation with an additional 5-centimeter thick layer of insulation. Walls are better sealed and more wind-resistant, while at the same time avoiding closing in moisture. Properly dimensioned ventilation systems keep the air healthy and take advantage of the heat through heat recovery.

MATER IAL CHOICE AND CONSTRUCTION

JM's residential units are built using sound, proven natural materials such as tile and wood. Back in the mid-1990s JM in Sweden developed its own environmental assessment system to steer the use of building materials toward reducing the burden on the environment. Material groups that are assessed include paint, adhesives, putty, flooring and roofing and JM has gathered the results in an environmental product database. Monitoring building supplies ensures that the goods do not entail any health or environmental risks for either customers or employees. JM's environmental assessment procedures have been adapted to the criteria developed within the framework of BASTA—the construction industry's joint system to discontinue the use of hazardous substances. JM is active in the development of BASTA.

All pre-construction and installation work in JM's residential units meet the requirements according to the industry rules "Safe water installation," which JM was the first to offer among the major construction firms. These rules also apply to installed heating systems. JM works with vapor barrier descriptions during planning and production to prevent moisture and water damage. We use moisture-tolerant and mold-resistant gypsum wallboard for both wet areas and exterior stucco walls. Stringent requirements are also placed on vapor barriers for bathroom walls in accordance with current construction regulations.

During the year the Swedish Testing and Research Institute published the report: "plaster framed walls," describing major problems with moisture and walls plastered with single-layer sealing. It is worth noting that the system JM uses for single-layer sealing is one of the three methods described as solutions that work.

CONSTRUCTION WASTE

Through planning, courses and cooperation with waste management companies, over the years JM in Sweden has endeavored to reduce the amount of unsorted waste and waste sent to the landfill from construction sites. This aspiration is also reflected in JM's operations program, which aims to reduce the amount of waste sent to the landfill by 50 percent and to reduce the amount of unsorted waste by more than 50 percent.

In order to encourage job sites with successful source separation of waste, and to motivate and encourage job sites to "compete" with each other to become better, JM has a "waste bonus" system. During the year the bonus was awarded to nine work crews at the job sites in Sweden that best succeeded at source separation of building waste for recycling.

The Ecocycle Council industry guidelines for waste management during construction and demolition, which JM helped to develop, are applied at all JM projects in Sweden.

TRANSPOR TS AND MACHINER Y

Transports of goods and people and construction machinery are responsible for considerable emissions of substances that impact health and the environment. JM contracts out most transports of goods and work requiring heavy machinery to suppliers. We are making progress in our efforts to develop logistics processes in

jm anua l r e port 2 0 0 9

entry to the stairwells.

boxes close to the bedroom.

drain clean.

A GOO D SOUND ENVIRO NME NT

relation to our suppliers, and projects are underway to increase the opportunities for JM to take control over deliveries to and from our construction sites. In this context JM is participating in a collaborative project within the industry to formulate tools to be able to set relevant requirements during procurement procedures for transport services. Consolidated shipments of materials, degree of utilization in trucks and the right type of delivery vehicle to the workplaces are examples of environmental improvements that are being tested and evaluated.

Today JM in Sweden makes demands about the fuel suppliers use; for example, only alkylate-based fuel can be used in small gasoline-driven machines. In Sweden, all JM company cars are "green" cars that run on ethanol (E85) or biogas, or that use hybrid technology.

All JM business trips must be planned with minimum impact on the environment with respect to carbon dioxide emissions. For instance, travel by train takes priority over travel by air, and collective transportation is encouraged for local travel. By using videoconference equipment at JM's offices in Stockholm, Göteborg, Malmö, Oslo, Copenhagen and Helsinki, many trips have been avoided and we have thereby reduced carbon dioxide emissions from business trips.

JM's residential projects in Stockholm use our subsidiary JM Entreprenad for subcontracted site excavation work. The company is conducting a project with a focus on reducing construction transports and increasing recycling of excavated material and rock material among the projects. The project to organize the first two recycling stations made good progress during the year. Additional spaces have been inventoried to increase the number of recycling stations.

CONTAMINATED SOIL

JM often acquires older industrial land that is transformed into residential areas after remediation of the land. JM is thereby making a large contribution from the standpoint of health and the environment by removing heavy metals and oil pollutants from the land prior to construction.

Soil remediation requires much planning, many studies and good communication with environmental authorities, contractors, controlling consultants and staff at laboratories and landfills. Sorting out material that can be reused on site reduces the need for truck transports.

Soil remediation in Bolinder Strand, Järfälla.

One example of remediation is the Kvarnholmen area in Nacka, outside Stockholm, which was once a dry storage facility for boats. Site remediation will now be carried out and a park will be built. From an area of about 4,000 square meters approximately 780 kg of lead, 30 kg of arsenic, 5 kg of cadmium, 710 kg of copper, 2 tons of zinc and 70 kg hazardous oil pollutants will be removed.

Another example is Dalénum on Lidingö, where JM built a large underground passage during the year. Extensive monitoring of the excavated material provided an opportunity to reuse a large amount of material within the area. About 7,200 tons of contaminated and unusable material was transported to the landfill during the year. Without monitoring and the opportunity to reuse materials, the amount transported to the landfill would probably have been twice as large.

Usually about 15–20 construction projects per year undergo soil remediation. In order to be able to properly handle contaminated soil JM employs two soil remediation experts, one in Stockholm and one in Malmö. Procedures are also clearly described in JM's operations management system.

		ENVIRO NME NTAL IMP ACT OF PRO	JECT DEVELOPME NT
	Acquisition	Planning	Construction site	Completed building	Demolition
Time in process	months	6–12 months	1–2 years	>100 years	months
JM's influence	major	major	major	diminishing	minor
Scope to prevent environmental impact	major	major	minor	minor	minor

Impact on the environment minor minor moderate major moderate

HOW WE WOR K

Since JM is a leading project developer and community builder, it is also natural for the company to assume responsibility for being a leader in the environmental field. JM was the first construction company in Europe to adopt an environmental policy in 1994 and ever since then the company has continued to push for environmental change in the industry. JM is constantly involved with various full-scale development projects. After assessment, certain solutions are then integrated into all of JM's production. It has always been important for JM to combine an effective environmental system that has a positive impact on the community with a natural understanding that the measures that JM takes must be good for the company's business model in both the short- and long-term. A successful environmental program should primarily benefit the company's customers, employees and the future of our children.

ORGANIZATION

JM's quality and environmental council, with the CEO and the company's business unit and regional managers, has responsibility for common governance and operations in Sweden, including environmental issues. The Group's quality and environment department is responsible, together with regional coordinators, for coordination, development and support in environmental initiatives. Activities include construction site visits to entrench and improve environmental initiatives in production. We address environmental issues in all our daily work and expect extensive commitment throughout the company.

OVER SIGHT AND FOLLO W-UP

In every substantial way, the operational systems developed within JM in Sweden meet the standards set by ISO quality and environmental management requirements. The primary goal has been to develop a system based on the processes and needs of the operation, but the organization is also well prepared for a possible certification in the future. JM develops its quality and environmental initiatives using operations programs with measurable and detailed objectives.

JM follow up on targets and requirements with nonconformity and key figure reports, as well as with internal audits.

JM held its environmental training program for employees in Sweden during the year, with the purpose of further increasing knowledge and commitment with respect to working with the company's common procedures.

PARTNER S

Much of JM's impact on the environment occurs via the company's external partners such as subcontractors and materials suppliers. All framework partners in Sweden undergo an environmental assessment to ensure that they only use or deliver products that meet environmental standards, that they have reliable procedures for waste management and documentation, and that they also have their own in-house environmental program. During the year the number of framework agreements increased by 11 percent, from 205 to 227.

INDUSTRY ISSUES

Environmental issues are sometimes industry-wide and environmental initiatives therefore require broad cooperation across corporate boundaries in order to succeed.

JM has been a member for several years of the international network Business Leaders Initiative on Climate Change (BLICC) to strengthen its climate work. Among other things, JM calculates and reports emissions in accordance with the international Greenhouse Gas protocol and strives to carry out operations with minimum impact on the environment.

JM has long been a member of the Ecocycle Council and it is affiliated with the government's Bygga-Bo dialogue project, in which several companies, municipalities and the Government jointly has undertaken to carry out certain measures within efficient energy consumption, efficient resource utilization and a healthy indoor environment.

JM has supported an industry-wide research project to develop a classification system for buildings. The purpose of this system is to facilitate environmental communication with customers and perhaps even to implement advantageous terms for buildings that meet high environmental standards. Today there is a growing interest in the industry for different types of systems for environmental standards in construction and JM carefully monitors these developments.

JM is a corporate member of Sustainable Innovation AB. Sustainable Innovation is a national center for energy efficiency in daily life. The primary purpose is to contribute to the development of Swedish industry in the field through commercialization of new technology. The organization has the support of the Swedish National Energy Administration to gather the strength of Swedish know-how in environmental engineering and energy efficiency. JM is running three development projects in cooperation with Sustainable Innovation.

JM is participating on the program board for the SBUF mandate on the third phase of the 2008–2011 SolEl Program. One of the purposes of the program is to increase the use of solar cells and to ensure that technology will become a natural part of the modern energy system. In the current phase of the program, activities focus on issues such as building integration, grid connection and standardization.

PROFITABLE ENVIRO NME NTAL PRO GRAM

For JM environmental initiatives are a matter of good business and profitability, in both the short and the long term—whether dealing with acute environmental problems or accepting responsibility for environmental issues of the future. This way JM continues to create long-term shareholder growth.

Measures conducted from this perspective also give added value to JM's customers. For example, energy-efficient houses, installations which conserve water and logical spaces for sorting waste all help to lower operating costs for households and provide environmental benefit for society.

Credit ratings agencies and mutual fund companies actively monitor JM's progress within sustainable development. JM reports information about its environment and sustainability initiatives to several external rating agencies, including the Carbon Disclosure Project (CDP) and Sustainable Shareholder Value. JM is listed on the OMX GES Sustainability Nordic Index since January 2010.

During the year JM signed a number of different initiatives in the environmental field, such as the Copenhagen Communique on Climate Change, the Climate Relay and the Initiative for renewable fuels.

sustainab le urban planning 33

GRO UP QUALITY AND ENVIRO NME NTAL POL ICY

JM shall promote long-term quality and environmental management in all its operations. The company shall focus on customer needs and strive for sustainable development of society.

To accomplish this, we shall:

• Preserve and contribute environmental aesthetic values to the urban and natural landscapes
• Produce buildings with a healthy living and working environment
• Work in a structured and systematic manner that leads to continual improvements in environmental and quality performance
• Prevent the production and dispersal of pollutants and promote resource conservation and closed cycles
• Actively contribute to development of knowledge and raise employee awareness of quality and environmental issues
• Apply environmental standards that are more rigorous than existing legal requirements.

QUALITY AND ENVIRO NME NTAL OB JECTIVES

• We shall focus on quality, the environment and ethics so that every customer and project is a good reference
• Our projects shall be structured, implemented and managed so as to minimize energy consumption and its impact on the environment
• We shall reduce the volume and hazardousness of waste
• We shall use materials and methods that reduce environmental impact and contribute to a healthy indoor and working environment.

FACTS AND KEY FIGURE S ENVIRO NME NT JM SWEDEN

The key figures are parameters that JM uses to guide the operation toward established environmental goals.

		2009	2008	2007
Implemented internal quality and environmental audits		126	106	106
Carbon dioxide emissions JM (tons) 1)		11,400	15,800	16,300
Carbon dioxide emissions JM (tons/SEKm) 1)		1.43	1.46	1.53
Newly produced homes' estimated carbon dioxide emissions from energy consumption (kg CO2/m2 UFA)		6	7	7
Percentage of building waste that goes to landfill (%) 2)		16	15	16
Products in environmental product database		2,952	2,731	2,412
Company cars that are clean cars (%)		100	97	91
Number of frame agreements with expanded environmental review		227	205	160
Projects with key indicators (%) 2)		96	100	89
Projects with key indicators (numbers) 2)		44	59	49
Goal fulfillment JM Residential Stockholm and JM Residential Sweden	Goal 2010	2009	2008	2007
h/m2 UFA) 3) Newly produced homes' estimated energy requirement, including household electricity, (kW	-	92	100	113
Building waste to landfill (kg/m2 GFA)	2	4.1	3.6	4.1
Percentage unsorted building waste (%)	15	33	30	40
Total quantity building waste (kg/m2 GFA)	13	25	24	25

1) Calculations are adapted to BLICC's climate calculation model and apply to all of Sweden.

2) Pertains to JM Residential Stockholm and JM Residential Sweden.

3) New energy measures approved 2007. Follow-up is based on a new calculation model beginning with 2008.

UFA = Useful floor area. GFA = Total floor area.

JM'S HOUSES ARE THE PRO DUCT OF A TEAM EFFOR T WITH A VARIETY OF SKILL S

In the long-term, the ability to attract talented new employees, while retaining those we already have, will be essential for our continued success.

ADAPTATION OF THE OR GANIZATION

The rapidly worsening economy in late 2008 had consequences for JM in the form of fewer housing starts, which in turn required an adaptation of the organization that continued until the spring of 2009. A total of almost 600 people had to leave JM in 2008 and 2009.

The age structure at JM continues to be evenly distributed because several job cuts were resolved through retirement. In addition, JM's core competency—housing development and production—remains in the company and we therefore are prepared to meet future demand from our customers for problemfree living. With current staffing of about 1,900 employees, we have capacity for about 3,000 residential units in production. However, access to engineers combined with the large number of retirements in the labor market in general continue to be a challenge for JM and will be critical for continued growth.

SKILL S DEVELOPME NT AND SUPPL Y OF EXPER TISE

At JM, our ambition is for relationships with our employees to be characterized by our core values: quality, a long-term approach, reliability, commitment, sensitivity and a sense of style.

JM holds employee performance appraisals at least once a year to review target fulfillment and how we lived up to our core values, which is related to the pay setting system. New goals are set during this conference and to reach them, individual developmental needs are reviewed and an individual skills development plan is prepared.

For both salaried employees and wage-earners, skills development largely involves job rotation and active on-the-job learning. In addition, we work with methods aimed at developing the experience and expertise that employees acquire, while ensuring a constant sharing of experience. By doing so we mobilize the expertise found at JM at the same time that major opportunities are provided for our employees to broaden their expertise and grow in their roles.

JM mainly meets requirements for managers and leaders through internal recruitment, which provides good opportunities for individual development within the company, while retaining knowledge of the business.

All JM managers also have the task of identifying future managers at an early stage, which facilitates adaptation of skills development initiatives to a future role as manager. At the same time it is crucial for JM's success that we also work throughout the Group to ensure the continued supply and growth of future leaders.

JM ACADEMY

In 2007 the JM Academy was founded to ensure that JM's employees develop the skills necessary to achieve JM's goals. At the same time we defined the managerial and employee skills that we need to be able to live and act in accordance with our core values. We follow up and assess our managers with respect to these management skills in performance appraisals at a development center and in our employee survey. There is a direct link between the skills assessment in the performance review and pay setting.

Training programs designed specifically for JM employees are gathered within the framework of the JM Academy. One of these programs is JM's leadership development program, which covers 450 managers and leaders and takes place in four steps:

1. "New manager at JM"

Basic training programs to ensure that new managers at JM have basic knowledge of issues such as employee performance appraisals and labor law;

2. "Leadership at JM"

This leadership training program at JM teaches managers and leaders the skills they need to ensure that they and their employees act in accordance with JM's core values;

3. "Development Center"

Evaluation center to identify individual development needs and continued development plans for JM's leaders;

4. "My leadership"

Individual development projects such as coaching, education in communication or analysis, which is planned based on the proposed plan in step three.

JM'S TRAINEE PRO GRAM

JM has offered a three-year trainee program since 1994 to ensure its supply of skills and leaders for the future.

Everyone in the trainee program needs to acquire broad expertise in housing construction and therefore a large part of their time is spent at our job sites. The individually tailored program focuses on areas such as management, pre-construction planning, costing, sales and management, providing the trainee with a wide range of skills in JM's business and production. In addition the trainee attends supplementary programs that are customized for the role the person will have in the future.

A total of 105 employees have attended the program since its inception.

JM'S COOPER ATION WITH SCHOOLS

Despite this year's need to adapt the organization to current conditions, one of the most important challenges for JM's future is to be able to attract new skilled employees. In addition to our positive collaborative efforts with Sweden's biggest colleges and

JM's Kalle Wendel, manager and trainee with a degree from the Royal Institute of Technology in Stockholm, meets students.

universities, we cooperate with several post-upper secondary schools, such as Rönninge Upper Secondary School and Nackademin. JM is represented on the school steering committee and actively participates in developing the syllabus. The Construction Program trains carpenters and concrete workers and the Construction Engineering Program trains upper secondary school students for supervisory positions. JM has been involved in the practical training program at the upper secondary school for a long time and has extremely positive experience of having our employees on different levels work as supervisors, mentors and teachers.

JM continues to work on the successful collaboration with Nackademin and participates in the formulation of its course content. Nackademin is a post-upper secondary program in residential construction and contracting that began in 2002. Students in the two-year training program are offered practical training place positions at JM and many were hired by JM during the year after completing their studies.

SALARIES AND BE NEFITS

About 650 of JM's managers, supervisors and a number of specialists in Sweden are covered by a performance-based salary system. The amount usually varies between one and seven monthly salaries, depending on position. Since 2001 JM has offered employees with a pensionable annual salary over ten official "base amounts" a pension plan, JM 10 Plus, with improved pension and insurance terms and conditions. JM 10 Plus pays five percentage points more in retirement benefits and guarantees both higher family pension and disability pension than traditional ITP.

JM has compensated employees for loss of income during parental leave since 2001 and commencing in 2008, this benefit is even more generous. Employees in Sweden now receive compensation for loss of income for up to twelve months of parental leave, which is eight to ten months over and above the collective agreements. The purpose is to support parents and help to achieve increased gender equality. During 2009 a total of 97 (128) employees took advantage of this opportunity.

GENDER EQUALITY AND DIVERSITY

Today 31 (34) percent of JM's administrative staff are women and 32 (30) percent of its managers and leaders are women.

Swedish society is characterized by increased cultural, social and religious diversity. For JM this means more business opportunities and a chance to reach new customer groups. Increasing diversity among employees is therefore a priority for the company, which is reflected in the recruitment of new employees.

JM works with the drug prevention alliance Mentor to strengthen relationships between adults and young people—including students with an immigrant background.

INTERNAL COMM UNICATION

Everything we say and do affects the image of JM and it is therefore important that employees share a uniform concept of the business, JM's brand and the work processes. Talented, dedicated employees who want to contribute to the business are critical factors for success. Candor, clarity, and dialog will permeate internal communication, grounded in personal contact with managers and colleagues.

Employees will have the fundamental knowledge they need to take care of their jobs and contribute positively to the company's development; printed and electronic channels are important tools and support. To this end, we have a personnel newsletter, an Intranet, posters in the workplaces and a management forum.

WOR K CLIMATE

JM is a big company with the advantages of a small company, through initiatives such as short decision-making paths. It is easy to be seen and recognized at JM. A large measure of freedom also stimulates personal responsibility and development, key factors for ensuring proper use of all skills and expertise. JM has a tradition of dialogue and mutual understanding. We believe this is one reason that so few conflicts have led to disputes and negotiations at the company's work sites.

JM has clearly stated that the Group's employees shall achieve a good balance in life between work and family. JM carries out an employee survey every other year, most recently in August–September, 2009. The questionnaire mainly assessed JM's work climate, leadership and organization. Despite the recent downsizing of the organization, a full 85 (89) percent of employees stated in the survey that they would recommend JM as an employer.

Staff turnover in 2009 was 6 percent (10) in Sweden and the average length of employment was about 12 (11) years.

HEALTH AND SAFETY

The health, well-being and development of employees are paramount for JM as an employer. JM works actively with wellness programs to minimize the number of on-the-job accidents.

WELL NESS PRO GRAM

Preventive care and wellness programs are essential tools for reducing sickness absence and work-related injuries. One of the measures in this program is our exercise program for builders, with daily warm-up and stretching during working hours, which has been required at our construction sites since 2007. In addition we offer strength training, massage and physical therapy.

FOCUS ON EARL Y RE HABILITATION

In 2009 total sickness absence at JM in Sweden was 3.6 percent (4.3) of total time worked. The reduction is the result of an active targeted rehabilitation program that began 2006 after the

JM'S ETHICAL GUIDEL INES

Consideration for our coworkers

• We respect each individual employee
• We accept no form of discrimination or harassment, neither in our relations with our colleagues nor with people outside the company
• We look out for one another and inform a superior if a colleague is in trouble.

Responsible

• We do not risk taking short-term decisions that might weaken the value of the JM brand
• We take responsibility for keeping ourselves informed about our own activities, even if this leads to difficult decisions
• We do not accept that time and cost requirements take precedence over worker protection and a good working environment
• We do not make commitments outside our professional mandates
• We categorically do not accept theft or stealing
• We comply with current legislation as a matter of course.

Serious agreements

• We follow and respect signed contracts and agreements
• We do not accept unauthorized workers at our workplaces
• We do not accept price cartels.

Professional relationships without personal gain

• We do not act in such a way that either our counterparty or we are placed in a position of personal dependence
• We should be highly restrictive as regards gifts and benefits to and from suppliers and business partners
• We do not allow suppliers or business partners to pay for our travel and subsistence, nor does JM pay for travel and subsistence for suppliers and business partners (unless regulated by agreement)
• We do not use the company's resources for private gain.

sick leave rate reached 6.0 percent of total time worked during the 2005 calendar year.

The program's effective rehabilitation process is based on early identification of the signals of ill-health, as well as a more systematic approach to JM employees on sick leave. The focus is on reducing the need for rehabilitation interventions while shifting initiatives toward health-promoting and preventive measures. JM's rehabilitation work is based on cooperation between human resources department, the responsible manager, the person on sick leave and the union. In order to strengthen occupational rehabilitation with aggressive medical rehabilitation, we have developed a partnership with a nationwide occupational health service.

JM is proactive during the rehabilitation process by initiating and financing interventions with the purpose of making it possible for the employee to stay on the job or return to work as soon as possible. These goal-oriented initiatives have time limits and are continually evalutated. Examples of treatment methods include counseling, health coaching, treatment by physical therapists and when needed vocational guidance. JM works to identify tendencies for stress at an early stage and offers coaching and counseling in an effort to prevent stress-related diseases, which are now becoming less common.

Long-term absence due to illness among craftsmen is mainly

EMPLOYEE S—GRO UP

	2009	2008	2007
Number of employees as of Dec. 31	1,850	2,365	2,415
– number of salaried employees	973	1,243	1,214
– number of wage-earners	877	1,122	1,201
Average age, salaried employees	45	43	43
Average age, wage-earners	42	40	39
Percentage of college graduates among salaried employees	28	26	26
Percentage of women among salaried employees	31	34	32

AVER AGE NUMBER OF EMPLO YEE S BY COUNTRY

	2009	2008	2007
Sweden	1,848	2,180	2,067
Norway	208	294	262
Denmark	17	31	31
Finland	7	12	9
Belgium	15	16	16
Total	2,095	2,533	2,385

ABSENCE DUE TO ILL NESS—SWEDEN

%	2009	2008	2007
Total absence due to illness	3.6	4.3	4.6
29 years or younger	4.6	4.6	4.5
30–49 years	3.1	3.5	3.7
50 years and older	3.9	5.5	6.2
Absence due to illness during consecutive
period of at least 60 days/total absence	51	50	47
omen's sickness absence	2.3	2.4	3.3
Men's sickness absence	3.9	4.7	5.0

due to musculoskeletal disorders and strain-related injuries, as well as recreational and occupational accidents.

GOO D ORDER ON THE BUILDING SITE

A safe and secure workplace is something each employee must be able to expect at work. JM has a zero tolerance position on accidents on the job and works proactively with preventive safety, through initiatives such as the "Neatness and Order check" at JM's construction sites. As part of the preventive safety program JM checks for risk management procedures, personal protective gear, neat workplaces, scheduled inspections and that appropriate permits are obtained.

The occupational accident rate (number of occupational accidents causing at least one day of sickness absence for 1 million worked hours) was 7.4 (10.5) for both administrators and craftsmen. For tradesmen alone, the figure was 15.8 (20.1). The number of occupational accidents with at least one day of sickness absence in 2009 was 21 (36).

ID06—General Provisions on the obligation to provide ID and attendance registration—is part of the construction industry's campaign to deal with unauthorized workers and economic crime. JM began to implement ID06 in 2007 in all new projects and phases.

STAFF INTER VIEW

Joakim Averland has worked as concrete worker at JM for 10 years. He's working on the foundation of an apartment block in central Uppsala.

Joakim recently changed workplaces, but knows most of his new coworkers from previously.

"I'm the union representative and in that capacity I visit all job sites in my region at least twice a year," says Joakim.

The tradesmen in his region have many different steps in their work. The same person who sets up a form for pouring concrete can then set up kitchens and the one who reinforces the foundation also spackles the bathroom floor and walls. This approach provides a natural job rotation and more all-round job skills.

Joakim participated in the reference group for the project to implement changes known internally as "Structured Production". A fundamental factor for success at work involves implementation of consistent working methods throughout production, which will begin in 2010 and is expected to continue for several years.

"Some are sure to feel that they don't get to do things the same way that they've always done them," says Joakim. "But once people realize that the point is not to work faster, but more effectively, and that this approach also achieves a better work environment at the same time, the end result will be good."

Joakim has worked for several different construction companies, but says that JM has a "humanistic" view of employees and is therefore the best employer in construction that he's had.

A ten-minute exercise session in the morning is mandatory and appreciated by most people.

"The exercise gets you going and you feel ready for a work day," says Joakim. "We've also changed our lunchtime at the job site and now eat at about 11 a.m., so we have more energy for the afternoon's work."

Cont rolled risktaking ess entia l for good profita bility

Making well balanced risk assessments is extremely important for a project development company, where risk management and value creation are strongly linked.

The goal for a project developer is to identify and acquire land at an early stage that can be developed, and then to produce and sell residential units in a manner that optimizes customer values, revenues and costs. Throughout this entire process the project developer faces a number of risks that, if handled correctly, contribute to improved profitability.

JM's main risks can be attributed to macroeconomic risks such as substantial and lasting interest rate hikes, a global economic downturn, increased unemployment in JM's main markets and stronger competition. These factors pose risks for the revenue level of our projects. If the structure of the building rights portfolio is not ideal the result could be lost opportunities or elevated costs, thus posing another significant risk. Risks associated with implementation are now considered to be lower after the focused work in recent years with oversight and control.

In 2008 and 2009 areas with historically lower risk have grown in importance. Problems in the financial system have meant increased liquidity risk for newly started projects and elevated valuation risk for project- and development properties on JM's balance sheet.

Risk management is an integrated part of decision-making at all levels within JM and is subject to strategic contributions from management and board. All significant business and project decisions are analyzed with regard to both risk and feasibility. Routines for project oversight, monitoring and follow-up are designed to reduce business and implementation risks.

MACROE CONOM IC RISKS

ECONOMIC GRO WTH

Demand for new housing is mainly affected by population growth and economic development in the individual towns and cities. The new residential units' location and attractiveness, consumer spending power, current interest rates, prices and price development on the existing home market affect demand and the price obtained by JM.

Deteriorating national or regional growth conditions or declining employment can have a negative impact on JM. JM's strategy is to operate in areas that have the best long-term demographic and economic conditions. Demand for housing is high in many places where JM operates. However, sharply rising housing prices in recent years have increased the risk of falling prices, even though households' housing costs have not reached alarmingly high levels. Housing expenditure as a proportion of disposable income was about 22 percent for Sweden (Source: SCB, 2008).

Global economic development also affects JM, in the short term due to psychological effects, since the world's financial markets are tightly linked and changed expectations spread fast, and in the longer term because global economic changes also have an impact on the highly internationalized Scandinavian companies.

In 2008 and early 2009, these conditions resulted in a rapidly deteriorating market situation in which all of JM's housing markets were affected by the recession.

The general interest rate situation is both a risk and an opportunity. Low interests leads to increased demand and higher prices for houses while the interest expenses on the Group's net borrowing decrease. The opposite applies when interest rates are high. The prevailing interest rate situation also affects return requirements and valuations in connection with property sales and acquisitions. A lower interest rate leads to a lower required rate of return and a higher price. Lower interest rates in 2009 had a positive effect on demand, despite the weaker economy.

JM tries to meet macroeconomic risks primarily by ensuring a clear demand for planned housing projects. A certain number of residential units must already be sold or reserved before production starts. By starting large projects in a number of phases, prices can be adapted to the prevailing market situation. Through continuous monitoring of the business environment, both internally and with the aid of external consultants, JM tries to form a wellfounded perception of trends for significant business environment factors.

Efficiency measures in order to reduce production costs are another way to reduce business risks. In this way slack demand and falling prices do not need to have a full impact on earnings. An important component of JM's efforts to cut costs is the pre-construction procedure introduced for apartment blocks in 2003 and for single-family homes in 2004. These procedures involve a more industrial way of working and production methods. They have also made it possible to increase savings with respect to production costs. In 2008 work with pre-construction procedures was expanded to include pre-construction planning without regional production resources.

COMPE TITIVE SCENARIO

JM's competitors in project development of new housing are both major national players and smaller local project development companies. Several of the large players have expressed an ambition to grow within the housing segment. The risk is that the increased competition will lead to a higher supply of housing and price pressure. JM tries to distinguish itself through its overall corporate culture, customer focus, flexibility, expertise in acquisitions, project implementation, quality profile, and marketing. The competitive situation in each local market is monitored continuously.

POLITICAL RISKS

A number of political risks are associated with housing construction. The conditions for different forms of tenure can change and affect demand for JM's housing. Political decisions related to infrastructure development as well as regional and municipal planning can have an impact on operations. JM tries to meet these risks by having detailed plans that are as flexible as possible and by deciding form of tenure relatively late. Political decisions also affect tax conditions for housing. The political climate is characterized by a willingness to increase and facilitate, not limit and obstruct, housing construction.

OPERATIONAL RISKS

RISKS REL ATED TO BUILDING RIGHTS POR TFOLIO

At year-end 2009 JM had building rights corresponding to 27,900 residential units (31,000) for future production, mainly concentrated to metropolitan areas and university and college towns.

The risk that JM has too few or too many building rights or that the building rights are in the "wrong" area, can lead to lost opportunities and high costs. As was already mentioned, it is essential that land for development and planned housing is in attractive locations in places with high demand for new housing. It must also be possible to develop the land in accordance with JM's requirements for profitability and return.

What and how much can be built, and when housing starts can take place, depends on planning work and cooperation with the municipality. The risk that after acquisition JM does not obtain a detailed plan that has gained legal force (a detailed plan approved by the municipality through a political decision) within the prescribed period may result in increased costs and/or reduced revenues.  With its extensive experience of project development and long-term relations with the municipalities, JM can reduce these risks.

In order to reduce tied-up capital and risks JM tries to have building rights available through conditional acquisitions; for example, the acquisition may be subject to an approved detailed plan. At year-end 2009/2010, about 9,500 building rights (10,900) were available for future production through such agreements. It is also possible to separate and sell development land from acquired land without affecting the number of available building rights. In addition to the risk of less than optimal capital structure, too much capital tied up in building rights also entails assessment risk relating to both market value and the risk of write-downs.

Historically, JM has been successful in identifying and developing areas where people want to live. At the end of 2009, 79 percent of residential units in JM's ongoing production were sold or reserved. One explanation is that JM works in close cooperation with potential home buyers so that planned projects will meet demand.

IMPLEME NTATION RISKS

Major projects can have a turnover of several billion Swedish kronor and it is important that both pre-construction and production are carried out according to plan. Inadequate planning and analysis can lead to delays, increased costs and insufficient customization. There is also a risk that the pre-construction process does not simultaneously focus on customer values, revenues and costs. In order to reduce implementation risks, JM introduced stricter routines for monitoring, oversight and control. Defined decision points precede the start of pre-construction, sales and production. No project can start without a decision from business unit management or Executive Management

Manag ement of significant risks
Risk factor	Risk	Management
Significant interest rate hike	Reduced demand, need for price	Production does not start until a certain proportion of units in the project are
Global economic downturn	reductions	sold or reserved
Increased unemployment in JM's markets		Internal efforts to reduce costs
Changes in regional prospects for growth		Product range in several price bands
		Business environment monitoring and market analysis
Increased competition	Increased supplies, price pressure	Business environment monitoring and market analysis
		Decision gates in connection with important project decisions
		Continuous efforts to maintain competitiveness in every respect
Structure in building rights portfolio Reduced demand, need for price		Strategic acquisition planning
not optimized	reductions, valuation of building rights	Business environment monitoring and market analysis
		Continuous evaluation of asset structure
Pre-construction not simultaneously focusing	Reduced demand, need for price	Market analysis, high-quality extensive surveys
on customer values, revenues and expenses	reductions	Broad compilation of skills in the project
		Requirement for skills development
Adopted detailed plan delayed and/or changed	Increased costs, decreased revenues	Clear requirements on formulation of pre-construction and building permit documents
		Quality assurance of building permit applications
		Long-term relations and close collaboration with the involved bodies
		Acquisition on condition that the local plan gains final approval
Difficulty for the banks to provide JM and its customers with financing	Limited financing for production and for JM's customers means lower sales and fewer housing starts	Long-term relationships and close collaboration with banks and other financing institutions

or, for major projects, by the Board. For more information see page 87, Corporate Governance Report.

UNSOLD UNITS

JM acts to ensure that all residential units are sold at final inspection. Units that remain unsold six months after final inspection are purchased by JM from the tenant-owner association and are then sold. Purchased residential units are recognized in the balance sheet as "Participations in tenant-owners associations etc". At the end of 2009, JM held 110 (66) unsold units for a value of SEK 353m (171) in the balance sheet, including 56 units in Egholm, Copenhagen, which accounted for SEK 185m. Starting projects in phases, with requirements for a specific level of sales and reservations, reduces the risk of unsold units. Phased starts also mean that JM can better match price to demand. Sales and acquisitions are listed in note 18, page 65.

COST CONTROL AND INTER NAL OVER SIGHT

In recent years JM has taken a number of measures to improve internal oversight and cost control. Most production costs are related to project development of housing in Sweden and were about SEK 4.6bn for 2009.

In order to ensure quality requirements and production competence and contribute to effective cost control, JM maintains construction contractor resources. Internal production resources are limited, which makes JM dependent on subcontractors' cost trend. In general, resources are contracted well ahead of time which means that JM's cost situation is usually under control. The number of projects, volume, development phase and utilization of subcontractors vary from year to year.

Sensitivity ana lysis , va rious cost cat egories, project development housing

Category	Share of costs %1)	Change %	Effect, SEKm
Salaries/wages	16	+/–10	+/–71
Material	13	+/–10	+/–58
Land	15	+/–10	+/–69
Developer's costs	16	+/–10	+/–73
Pre-construction	4	+/–10	+/–20
Overhead	5	+/–10	+/–25
Subcontracting	31	+/–10	+/–140

1) Share of cost base, project development of housing in Sweden was about SEK 4.6bn 2009.

Land refers to the acquisition cost for land. Developer's costs are costs not directly related to contracting, such as interest on loans, municipal connection charges and registration of title. Pre-construction mainly relates to costs for technical consultants. Overhead refers to incidental expenses for setting up the building site and rent for fixed assets such as machinery.

FINANCIAL RISKS

FINANCIAL FUNCTION

JM's finance unit handles the Group's short- and long-term financing, liquidity planning, cash management and financial risk management. The division of responsibility, organization and control of the Group's overall financing activities are regulated by a finance policy established by the Board.

The finance policy specifies the objectives for finance operations, overall responsibility and specific rules and limits.

The objectives for the finance operations are to:

• Support operating activities in residential and commercial project development
• Optimize use of capital and cash flow management
• Control and manage the financial risks to which JM is exposed.

FINANCE STRATEGY

JM's basic finance strategy is to clearly link cash flows from projects in progress and project properties to the company's borrowing and interest rate risk management. This strategy provides the best control of financial risks. In order to maintain flexible administration and cost-effective debt management, existing loan agreements are guaranteed by JM's excellent credit worthiness, which means that no mortgage deeds are provided.

FINANCIAL RISKS

The Group's financial risks primarily consist of interest rate risk, financing-, liquidity- and, to a limited extent, currency risk. The choice of maturities and fixed interest spread is governed by several factors; capital tied up in ongoing projects, business risk, anticipated dates for sale of properties, terms of leases in project properties and the Group's financial position in general. These factors are summarized in the Board's guidelines for fixed interest spread and maturity structure with scope for deviations within certain limits based on current market situation. There are also rules for handling interest rate risk in building loans during the construction period and recommendations for final financing of tenant-owners associations.

Cash and cash equivalents are usually kept at a balanced level and any surplus liquidity may only be invested in Swedish banks and in Swedish fixed-income securities without currency risk. Payment preparedness is maintained through overdraft facilities and committed credit lines.

The liquidity supply to residential projects has been a limiting factor for new housing starts in 2008 and 2009.

JM's Kurt Jonsson works with concrete forms and reinforcing on the Kista Terrace project in northwest Stockholm.

Currency risk on transactions is eliminated as far as possible. Transaction volumes in foreign currency between JM AB and subsidiaries, and to external suppliers, are very limited. Hedging of balance sheet exposure is selective. Derivative instruments may only be used in order to minimize risks.

SENSITIVITY ANALYSIS— RESIDENTIAL BUILDING RIGHTS

One way to reflect the dynamics in the building rights portfolio is to perform a sensitivity analysis where all anticipated cash flows from the portfolio are calculated at present value. The analysis includes a number of simplified assumptions designed to reveal the present value of JM's building rights portfolio, at a number of assumed sales prices if the building rights portfolio is kept at a constant level with respect to numbers and amounts. 27,900 building rights are evenly distributed over a nine-year production period. The initial investment is excluded since the calculation is intended to show the value of the portfolio. Conditional acquisitions are handled as if payment for acquisition takes place simultaneously with invoicing to future homeowners.

JM's standard residential unit is assumed to be 80 square meter, the assumed tax rate is 26.3 percent and the discount rate after tax is 6.5 percent. The calculation does not take possible inflation into account and is not a forecast.

The table shows the assumed revenue and project expenses per square meter of apartment space excluding VAT. If a specific revenue or project expense per square meter is assumed to apply to the entire building rights portfolio, a value is created, expressed as present value. The analysis shows a strong leverage effect in value creation depending on the company's ability to manage both revenues and expenses effectively, and not least the general trend for house prices during the period. A price or cost change of SEK 1,000 per square meter corresponds to SEK 1,200m, or almost SEK 15 per share according to the basis for this calculation.

The sensitivity analysis below excludes cash flows from previously recognized land (SEK 4,882m) after adjustment of liabilities for property acquisitions (SEK 962m). The present value of these cash flows amounts to about SEK 2.3bn.

Sensitivity ana lysis , present va lue, SEKm for JM'S bui lding rights portf olio for housing

Revenue/m2, SEK	25,000	26,000	27,000	28,000	29,000
Cost/m2 , SEK
20,000	6,100	7,300	8,500	9,700	10,900
21,000	4,900	6,100	7,300	8,500	9,700
22,000	3,700	4,900	6,100	7,300	8,500
23,000	2,500	3,700	4,900	6,100	7,300
24,000	1,200	2,500	3,700	4,900	6,100

Sensitivity ana lysis , present va lue, SEK/sha re for JM's bui lding rights portf olio for housing

Revenue/m2, SEK	25,000	26,000	27,000	28,000	29,000
Cost/m2 , SEK
20,000	73	88	102	117	131
21,000	59	73	88	102	117
22,000	44	59	73	88	102
23,000	30	44	59	73	88
24,000	14	30	44	59	73

contents	page
board of directors' report	43
consolidated income statement	47
consolidated balance sheet	48
consolidated cash flow statement	50
consolidated statement of changes in equity	52
notes—group	53
income statement and cash flow statement—parent company	69
balance sheet—parent company	70
statement of changes in equity—parent company	71
notes—parent company	71
five-year overview—group	74
quarterly overview—group	76
quarterly overview—business segments	77
proposed disposition of earnings	78
auditors' report	79
definitions and glossary	80

The Board of Directors and the President of JM AB (publ), Company reg. no 556045-2103, hereby submit the annual accounts and consolidated accounts for 2009.

SUMMARY GROUP

MARKET , SALES AND HOUSING STARTS

Demand for newly built homes steadily improved in 2009 in JM's main markets in Sweden and Norway and we have experienced a stabilization of demand in Denmark. Sales remained strong at the end of the year. The ability of the banking system to handle the supply of liquidity for new projects continues to be an important factor. Financing was ensured for the projects that began during the fourth quarter. The negative effects of the weak economy during 2009 were offset by the lower interest rates, which improved market conditions.

The number of sold residential units in the form of signed contracts was 3,291 (1,871), of which 610 (0) involve rental projects for external clients, including 562 homes in Stockholm and 48 in Norway. The percentage of sold or reserved homes in relation to current production continued to increase during the fourth quarter and now amounts to 79 percent, with an interval of 60-65 percent considered normal. The cancellation rate for reservations continues to be low. JM Residential Stockholm sold 1,713 (1,061) residential units, JM Residential Sweden 973 (564) and JM International 605 (246).

Number of housing starts totaled 2,150 residential units (1,829) including 1,102 (973) in the Stockholm area and 689 (597) elsewhere in Sweden. Housing starts in international operations totaled 359 (259) residential units. Residential housing starts include 492 rental units in Stockholm and 48 rental units in Norway, all for external clients. Construction on new projects begins as financing arrangements fall into place. The rate at which housing starts increase also depends on ensuring that resources can be allocated to handle larger production volumes. The number of residential units in current production amounts to 3,744 (5,118).

INCOME, OPERATING PROFIT AND OPERATING MARGIN

Consolidated income for the year fell 28 percent to SEK 8,778m (12,229), mainly due to the lower level of housing starts in 2008 and 2009. Operating profit fell to SEK 664m (1,083) and operating margin decreased to 7.6 percent (8.9).

The reduction of earnings and margins is due to the lower level of sales and construction starts in housing over the past few years. Profit during the first six months of the year was also limited due to the expected adverse effect of the worsened economy on future demand and prices for JM homes. Consequently during the first six months of the year costs arose due to restructuring and termination of projects in those markets where our hibernation strategy was established, as well as in Norway. With improved market conditions during the second half of the year, such costs were not incurred, other than to a very limited extent during the third quarter.

During the year properties sold for SEK 665m (748) with capital gains of SEK 89 (73). Rental income from JM 's project properties totaled SEK 69m (117), including SEK 6m (49) for residential units. Net operating income was SEK 0m (17).

INCOME

Consolidated income in 2009 fell to SEK 8,778m (12,229), mainly due to the lower level of housing starts in 2008 and 2009. JM Residential Stockholm and JM Residential Sweden posted the largest drop in revenue.

OPERATING PROFIT

Consolidated operating profit decreased by almost 40 percent to SEK 664m (1,083) in 2009. This result includes capital gains from property sales of SEK 89m (73) with a charge of SEK 87m (320) for write-downs of development properties.

Operating profit for JM Residential Stockholm dropped to SEK 496m (920) and operating margin fell to 14.9 percent (17.3). The reduction in operating margin is due to a lower price level in the projects and the decreased project volume. Costs for completed staff cutbacks during the year were lower than expected, which had a positive effect on the result of about SEK 25m during the fourth quarter.

Operating profit for JM Residential Sweden decreased to SEK 166m (197) and operating margin increased to 7.2 percent (6.0). The increased operating margin is attributable to the improvement in demand.

Operating profit for JM International declined to SEK –192m (–176) and operating margin fell to –14.2 percent (–8.6). The reduction in operating margin during the year is attributable to a lower price level in the projects and the decreased project volume. The hibernation strategy in Denmark and Finland had a negative impact on financial performance due to the limited project volume. Operating profit for JM Property Development rose to SEK 110m (75). The increase is mainly attributable to higher contracting revenues. Gains from property sales during the year totaled SEK 75m (74). Net operating income for project properties was SEK –6m (14) and contracting revenues from production amounted to SEK 63m (19).

Operating profit for JM Production increased to SEK 130m (124) and the operating margin was 6.5 percent (6.2). Demand on the contracting market in Stockholm declined and competition for projects continues to be intense.

BUSINESS SEGMENT s	Income			Operating profit 1)		Operating margin, %
SE Km	2009	2008	2009	2008	2009	2008
JM Residential Stockholm	3,330	5,317	496	920	14.9	17.3
JM Residential Sweden	2,296	3,263	166	197	7.2	6.0
JM International	1,353	2,058	–192	–176	–14.2	–8.6
JM Property Development	309	213	110	75
JM Production	2,008	2,008	130	124	6.5	6.2
Elimination	–518	–630	-	-
Group-wide expenses	-	-	–46	–57
Total	8,778	12,229		664 1,083	7.6	8.9
1) Of which, write-downs on properties			–87	–320

RESIDENTIAL UNITS IN CURRENT PRODUCTION

	Dec 31, 2009	Dec 31, 2008
Number of residential units in current production1)	3,744	5,118
Percentage sold residential units in current production, %2)	54	45
Percentage reserved residential units in current production, %	25	9
Percentage sold and reserved residential units in current production, %	79	54

1) Beginning with production startup through final occupancy according to plan 2) Percentage sold residential units expressed as binding contract with end customer

completed production, unsold units

	Dec 31,	Dec 31,
	2009	2008
Completed production, number of unsold units 1)	146	245
– including the balance sheet item reported as
"Participations in tenant-owners associations, etc."	110	66

1) After final occupancy according to plan

FINANCIAL INCOME AND EXPENSES

Financial income and expenses totaled SEK –117m (–31), a worsening of SEK 86m compared with the previous year. Financial income decreased because of generally lower interest rates compared with the previous year. At the same time financial costs increased, mainly due to a debt instrument that became interestbearing as of the fourth quarter of 2008.

PROFIT BEFORE TA X

Net profit before taxes was SEK 547m (1,052), a decrease of more than 48 percent compared with 2008.

PROFIT FOR THE YEAR

Profit for the year was SEK 379m (818). Total tax expense was SEK –168m (–234) including current tax of SEK –161m (–82) and deferred tax of SEK –7m (–152). Tax expense for 2009 exceeds the nominal tax rate for the Group, which is primarily explained by the reassessment of deferred tax relating to a loss carry-forward in JM International. A charge of SEK 24m (23) was taken against earnings for the property tax, which is treated as an operating expense.

DEVELOPMENT OF OPERATIONS

BUILDING RIGHTS

JM's available building rights total 27,900 residential units (31,000), including 18,400 residential units (20,100) recognized on the balance sheet. This means that 9,500 building rights (10,900) are controlled by agreement and are not recognized as assets. Capital tied up in building rights (development properties on the balance sheet) for residential units decreased to SEK 4,882m (5,540) at year-end. In addition the JM Property Development business segment has access to building rights for commercial project development, including 220 building rights for rentals equivalent to about 74,000 square meters with a total carrying amount of SEK 108m (80).

TOTAL NUMBER OF RESIDENTIAL BUILDING RIGHTS

(including rights carried in the balance sheet as development properties)

	2009			2008
JM Residential Stockholm	10,700	(7,500)	12,200	(8,200)
JM Residential Sweden	10,200	(6,500)	11,000	(6,800)
JM International	7,000	(4,400)	7,800	(5,100)
Total approx.	27,900	(18,400)		31,000 (20,100)

Valuation of JM 's total development properties with a carrying amount of SEK 5.0bn (5.6), including commercial building rights of SEK 0.1bn (0.1), indicates a surplus value of SEK 1.9bn (1.7). This valuation was carried out in cooperation with independent appraisal companies. An internal evaluation of the projects then serves as the basis for the write-down of development properties of SEK 87m. The write-down, which was carried out during the second quarter of 2009, is related to a number of properties, mainly located in Copenhagen and Stockholm. JM acquired development properties during 2009 for a total of SEK 428m (1,571). Net investments in development properties during the year totaled SEK –613m (608), after which holdings amount to SEK 4,990m (5,620). These holdings are essential for JM 's residential development projects.

development properties (HOUSING )

	Dec 31, 2009		Dec 31,2008
SE K billion	Market value	Carrying amount	Market value	Carrying amount
JM Residential Stockholm	3.2	2.1	3.4	2.4
JM Residential Sweden	1.9	1.5	1.8	1.5
JM International	1.7	1.3	2.0	1.6
Total	6.8	4.9	7.2	5.6

PROJECT PROPERTIES

Rental income from JM 's project properties totaled SEK 69m (117), with residential properties accounting for SEK 6m (49). Net operating income was SEK 0m (17).

In 2009 JM sold properties for a total of SEK 665m (748) with a capital gain of SEK 89m (73). Major property sales during the year include two special housing facilities for the elderly in Sigtuna and Nacka for SEK 209m with gains of SEK 27m, as well as a rental project in Hägernäs, Täby, for SEK 85m with gains of SEK 4m. External appraisers calculated the market value of JM 's project properties to be SEK 610m (669) with a carrying amount of SEK 596m (614). The surplus value is therefore SEK 14m (55).

PRO JECT PROPERTIES				Occupancy
Dec 31, 2009	Market value, SE Km	Carrying amount, SE Km	Area (000) m2	rate annual rent, %
Properties under development	566	558	63	89
Fully developed commercial properties	44	38	3	91
Total	610	596	66	89

Investments and acquisition of project properties totaled SEK 453m (314).

FINANCIAL ITEMS

INTEREST-BEARING LIABILITIES AND AVERAGE INTEREST RATES

As of December 31, 2009, interest-bearing net receivables amounted to SEK 189m, to be compared with interest-bearing net liabilities of SEK 842m the previous year. At year-end non interest-bearing liabilities for implemented property acquisitions amounted to SEK 228m (380). Of these liabilities, SEK 116m (109) are current liabilities.

Total interest-bearing loans as of December 31, 2009, amounted to SEK 1,842m (1,964), including pension liabilities of SEK 565m (513). At year-end the average interest rate for the total interest-bearing loan stock including pension liability was 4.0 percent (4.9). The average fixed-interest period for the Group's total loan stock, excluding the pension liability, was 0.3 years (1.0).

CASH FLOW

Cash flow from operating activities was SEK 1,124m (101), including SEK 780m during the fourth quarter. Cash flow was strengthened during the fourth quarter by sales proceeds received for properties of SEK 373m and the final payment of SEK 375m for a completed contract for the newly built Frösunda office for Vasakronan. Consolidated cash flow from project properties (sales minus investment) during the year contributed SEK 532m (–91).

LIQUIDITY

The Group's available liquidity was SEK 4,830m (3,911). Aside from cash and cash equivalents of SEK 2,030m (1,111) this includes unutilized overdraft facilities and credit lines totaling SEK 2,800m (2,800) where credit agreements for SEK 2,400m have an average maturity of two years.

EQUITY

Consolidated shareholders' equity as of December 31, 2009, was SEK 3,668m (3,241). Share capital totaled SEK 83m (83), other paid-up capital SEK 763m (760), and reserves SEK 86m (44). Undistributed earnings amounted to SEK 2,736m (2,354), including profit for the year of SEK 379m (818).

No dividend was paid to shareholders in 2009. The equity ratio was 37 percent (32).

HUMAN RESOURCES

The number of employees decreased during 2009 by 22 percent and at year-end amounted to 1,850 (2,365). The reduction is attributable to the decision taken in 2008 to cut back on the number of employees. The number of wage-earners was 877 (1,122) and the number of white collar employees 973 (1,243). The average number of employees during the year was 2,095 (2,533) including 247 (353) employed in JM 's foreign subsidiaries. Wages, salaries, and social security expenses totaled SEK 1,427m (1,566), of which social security expenses comprised SEK 458m (480).

ENVIRONMENTAL WOR K

How JM treats the environment today will leave its mark long into the future. Environmental initiatives require a businesslike approach in the short and long term, providing long-term value growth for owners as well as added value for customers, such as lower operating costs. JM continuously develops its environmental work using operations systems, measurable targets and environmental training programs, with follow-up through nonconformity and key figure reports, as well as with internal audits. High-priority environmental issues include low energy consumption in housing, environmentally approved building materials, ecocycle-based construction waste management, environmentally sound procurement of transports and work with construction machinery as well as remediation of decontaminated soil.

WORK OF THE BOARD IN 2009

The 2009 Annual General Meeting elected seven ordinary members. Two employee representatives and two deputies were also elected. Board member Berthold Lindqvist, who was also chairman of the Board's Audit Committee, passed away in December 2009.

The Board of Directors held nine meetings, two of which were per telephone and one per capsulam (meeting by letter). In addition the Audit Committee held four meetings, the Compensation Committee five meetings and the Investment Committee two meetings. The most important issues for the Board during 2009 were decisions to start production on large housing projects, major acquisitions of development properties, the strategic plan, the long-term variable salary program and sale of large project properties. The Board members' participation can be seen in the chart on page 83. Each year the Chairman of the Board evaluates the work of the Board with the Directors and reports the results to the Nomination Committee. A description of Committees and Directors can be seen on pages 83–84.

DIVIDEND

For 2009 the Board of Directors proposes a dividend of SEK 2.50 (0) per share, for a total of SEK 208m. The proposed record date for the dividend is Monday, May 3, 2010. If the Annual General Meeting resolves to adopt the recommendation the dividend will be sent on May 6, 2010.

REPURCHASED SHARES

On December 31, 2009 JM 's share capital amounted to SEK 83m, represented by 83,216,883 shares, including 185,000 repurchased shares. All shares carry equal voting rights and equal rights to a share of the company's equity.

REMUNERATION TO EXECUTIVE MANAGEMENT

The Board of Directors' proposal for resolutions on guidelines for salary and other remuneration to senior executives can be seen below. The proposal will be presented for approval at the Annual General Meeting. The guidelines are the same as those adopted at the 2009 Annual General Meeting with the change that the short-term variable salary program will be capped at 50 percent of fixed salary, as opposed to the previous maximum of seven monthly salaries. Moreover, the text relating to the longterm variable salary program was changed to be capped at 50 percent of fixed salary, as opposed to the previous 30 percent of fixed salary. No new agreements were entered into with senior executives since the 2009 Annual General Meeting. A few senior executives have older agreements entitling them to retirement at age 60; please see note 3, Employees and personnel costs, page 58.

PROPOSAL FOR 2010 RESOLUTIONS ON GUIDELINES FOR SALARY AND OTHER REMUNERATION TO SENIOR EXECUTIVES :

The Board of Directors proposes that the Annual General Meeting approve the following guidelines for salary and other remuneration to senior executives. Compensation to the CEO and other senior executives shall consist of fixed salary, short- and long-term variable salary programs, pension benefits and other benefits. "Other senior executives" refers to Executive Management. Total compensation must be at market rates and competitive in the labor market in which the executive works. Fixed salary and short-term variable salary programs will be related to the executive's responsibilities and authorities. The short-term variable salary program for senior executives will be capped at 50 percent of fixed salary. The short-term variable salary program will be based on performance in relation to established targets, which is usually the externally reported operating profit before tax, earnings per share and Customer Satisfaction Index. The long-term variable salary program can be share- and/or cashrelated and will be performance-based and, at the time of commitment, be capped at 50 percent of fixed salary. Termination of employment is normally subject to a mutual period of notice of six months. If notice of termination is given by JM , severance pay equivalent to six months' salary should also be payable. Pension benefits shall be either defined benefit or defined contribution, or a combination thereof, and the normal retirement age is 65. The Compensation Committee will draft and the Board of Directors will approve the remuneration policy for the CEO and senior executives. The Board shall have the right to depart from the guidelines if extenuating circumstances are present in the individual case.

PARENT COMPANY

The Parent Company's core business is project development of residential and commercial properties.

Net sales in 2009 for the Parent Company amounted to SEK 5,990m (8,702). The Parent Company's profit before appropriations and tax was SEK 455m (1,560). Investments in properties totaled SEK 327m (435). The average number of employees was 1,337 (1719), including 1,073 men (1,392) and 264 women (327). Wages, salaries, and social security expenses totaled SEK 936m (1,086). An account of the number of employees and payroll expenses is provided in the Parent Company's notes, note 2, page 71.

CONSOLIDATED INCOME STATEMENT , SE Km	Note	2009	2008
	1
Income	2	8,778	12,229
Production and operating costs	3, 4	–7,501	–10,180
Gross profit		1,277	2,049
Selling and administrative expenses	3, 4, 5	–615	–719
Gains on the sale of properties	6	89	73
Write-downs on properties	7	–87	–320
Operating profit	2	664	1,083
Financial income	8	41	88
Financial expenses	8	–158	–119
Profit before tax		547	1,052
Taxes	9	–168	–234
Profit for the year		379	818
Other comprehensive income
Translation differences		42	20
Comprehensive income for the year		421	838
Attributable to:
Shareholders of the Parent Company		379	818
Profit for the year attributable to:
Shareholders of the Parent Company		421	838
Earnings per share, basic and diluted, (SEK) attributable
to shareholders of the Parent Company	10	4.60	9.50
Proposed dividend per share (SEK)	10	2.50	0

NOTES

INCOME

(2009: SEK 8,778m, 2008: SEK 12,229m) Consolidated income for the year fell 28 percent to SEK 8,778m (12,229), mainly due to the lower level of housing starts in 2008 and 2009.

Income mainly consists of recognized revenues in projects. Recognized revenues are reported according to the percentage of completion method, which means that income is recognized based on the most recent forecast, period by period, as each project is completed and sold.

OPERATING PROFIT

(2009: SEK 664m, 2008: SEK 1,083m)

Operating profit was down 39 percent. The reduction of earnings is due to the lower level of sales and construction starts during the past years in residential housing. Profit during the first six months of the year was also limited due to the expected adverse effect of the worsened economy on future demand and prices for JM homes. Consequently, during the first six months of the year expenses arose due to restructuring and termination of projects in those markets where our hibernation strategy was established, as well as in Norway.

Write-downs of SEK 87m for development properties in Copenhagen were charged against operating profit in the second quarter.

FINANCIAL INCOME AND EXPENSES

(2009: SEK –117m, 2008: SEK –31m) Net financial items worsened by SEK 86m compared with the previous year. Financial income decreased because of generally lower interest rates compared with the previous year. At the same time financial costs increased, mainly due to a debt instrument that became interest-bearing as of the fourth quarter of 2008.

TA XES

(2009: SEK –168m, 2008: SEK –234m)

Recognized tax expense is 31 percent in 2009, compared with 22 percent for 2008. The increase is mainly due to a reassessment of deferred tax relating to loss carry-forward in JM International.

INCOME BY BUSINESS SEGMENT

CONSOLIDATED BALANCE SHEET , SE Km	Note Dec 31, 2009			Dec 31, 2008
ASSETS	1 2
Non-current assets
Goodwill	11		62	56
Plant, property, and equipment	12		18	21
Participations in associated companies	13, 14		12	6
Interest-bearing financial assets	15		1	11
Other financial assets	15, 16		70	10
Deferred tax assets Total non-current assets	26		95 258	80 184
Current assets
Project properties	17		596	614
Development properties	17		4,990	5,620
Participations in tenant-owners associations, etc.	18		353	171
Accounts receivable			385	507
Other current receivables	19		347	874
Prepaid expenses and accrued income			3	15
Recognized revenue less progress billings	20		968	959
Cash and cash equivalents	21		2,030	1,111
Total current assets			9,672	9,871
TOTAL ASSETS			9,930	10,055
EQUITY AND LIABILITIES	2
Equity attributable to shareholders of
the Parent Company 1) Share capital			83	83
Additional paid in capital			763	760
Reserves			86	44
Undistributed earnings (including profit for the year)			2,736	2,354
Total shareholders' equity			3,668	3,241
Liabilities
Non-current liabilities
Non-current interest-bearing liabilities	22, 23		326	314
Other non-current liabilities			113	271
Provisions for interest-bearing pensions Other non-current provisions	24 25		565 185	513 166
Deferred tax liabilities	26		943	900
Total non-current liabilities			2,132	2,164
Current liabilities
Accounts payable			365	497
Current interest-bearing liabilities	22		951	1,137
Other current liabilities			471	414
Current tax liabilities			77	17
Progress billings in excess of recognized revenue	27		1,315	1,583
Accrued expenses and deferred income	28		818	890
Other current provisions Total current liabilities	25		133 4,130	112 4,650
Total liabilities			6,262	6,814
TOTAL EQUITY AND LIABILITIES			9,930	10,055
Pledged assets and contingent liabilities	29

1) See Statement of changes in consolidated shareholders' equity.

PROJECT PROPERTIES

(2009: SEK 596m, 2008: SEK 614m) The portfolio of project properties is somewhat smaller

than the previous year. Major property sales during 2009 include the sale of the project property in Oslo that JM Norway uses as its headquarters, as well as residential properties in Johanneshov and Gullmarsplan, Stockholm, to newly formed tenant-owners associations. In addition two special housing projects for the elderly in Sigtuna and Nacka were sold, as well as a rental project in Hägernäs. Purchase consideration for property sales amounted to SEK 665m during the year with gains of SEK 89m (please see note 6 for further details).

DEVELOPMENT PROPERTIES

(2009: SEK 4,990m, 2008: SEK 5,620m) The rate of acquisition of development properties was slower in 2009 compared with the previous year. Dur-

ing the year JM acquired development properties for SEK 428m (1,571m), while development properties for SEK 910m (781) were transferred to production. All acquisitions involve development properties intended for housing. Major sales of development properties during the year involved development land in Stockholm and Mölndal. Write-downs of development properties in Copenhagen for SEK 87m occurred during the year. In all, JM has 18,400 (20,100) building rights on the balance sheet.

NOTES

PARTICIPATIONS IN TENANT -OWNERS ASSOCIATIONS ETC .

(2009: SEK 353m, 2008: SEK 171m)

Unsold tenant-owned apartments are purchased no later than the settlement date and are a consequence of the undertaking in the construction contract with the tenant-owners association. The number of unsold homes on the balance sheet amounts to 110 (66), including 56 from the Egholm project in Copenhagen, corresponding with SEK 185m.

OTHER CURRENT RECEIVABLES

(2009: SEK 347m, 2008: SEK 874m) Other current receivables decreased by SEK 527m, mainly because of a decrease in receivables from property sales as payments were received.

CASH AND CASH EQUIVALENTS

(2009: SEK 2,030m, 2008: SEK 1,111m) Please see the notes on the Consolidated cash flow statement, page 51.

EQUITY

(2009: SEK 3,668m, 2008: SEK 3,241m) Please see the notes on Changes in consolidated shareholders' equity, page 52.

NON -CURRENT INTEREST -BEARING LIABILITIES

(2009: SEK 326m, 2008: SEK 314m)

Non-current interest-bearing liabilities increased somewhat, in part because JM 's employees were invited to participate in a convertible program in 2009. As required by IAS 32, the liability and equity components are accounted for separately, which means that the debenture loan is carried on the balance sheet as a non-current interest-bearing liability. At the same time, non-current interest-bearing liabilities to credit institutions decreased during the year, which entailed that the closing balance overall did not increase to any great extent.

CURRENT INTEREST -BEARING LIABILITIES (2009: SEK 951m, 2008: SEK 1,137m)

Current interest-bearing promissory notes and liabilities to credit institutions decreased during the year.

OTHER NON -CURRENT LIABILITIES

(2009: SEK 113m, 2008: SEK 271m)

Other non-current liabilities decreased during the year because the balance sheet items mainly contain promissory notes to finance large acquisitions of development properties. Most of these notes were redeemed during the year.

CONSOLIDATED CASH FLOW STATEMENT , SE Km Note	2009	2008
1
OPERATING ACTIVITIES
Operating profit before financial items	664	1,083
Depreciation	13	10
Write-downs	87	320
Adjustment for non-cash items	–23	–64
Sub-total, cash flow from operating activities	741	1,349
Interest received	11	82
Dividends received	2	1
Interest paid and other financial expenses	–132	–68
Repaid/paid tax	73	–132
Cash flow from operating activities before change
in working capital	695	1,232
Investment in development properties etc.	–2,154	–2,234
Payment on account for development properties etc.	2,395	1,007
Increase/decrease in accounts receivable	122	–69
Increase/decrease in other current receivables, etc.	–52	–143
Increase/decrease in accounts payable	–132	–119
Increase/decrease in other current operating liabilities	–282	518
Cash flow before investments and sales of
project properties	592	192
Investment in project properties etc.	–366	–234
Sale of project properties etc.	898	143
Cash flow from operating activities	1,124	101
INVESTING ACTIVITIES
Investment in property, plant, and equipment	–9	–12
Property, plant, and equipment sold	1	7
Change in financial assets	–43	1
Cash flow from investing activities	–51	–4
FINANCING ACTIVITIES Loans raised	462	852
Amortization of debt	–620	–410
Redemption and repurchase of own shares	-	–1,008
Dividend	-	–489
Cash flow from financing activities	–158	–1,055
Cash flow for the year	915	–958
Cash and cash equivalents, January 1	1,111	2,061
Exchange rate difference in cash and cash equivalents	4 2,030	8
Cash and cash equivalents, December 31		1,111
22 INTEREST -BEARING NET LIABILITIES / RECEIVABLES
Interest-bearing liabilities and provisions	1,842	1,964
Cash and cash equivalents	–2,030	–1,111
Interest-bearing receivables Interest-bearing net liabilities (+)/receivables (–) at year-end	–1 –189	–11 842

OPERATING ACTIVITIES

to cash flow for the year.

(2009: SEK 1,124m, 2008: SEK 101m) Cash flow from operating activities improved to SEK 1,124m (101), mainly attributable to the sale of commercial properties. Investments in development properties decreased compared with the previous year at the same time that transfer to production increased somewhat, which overall made a positive contribution

Cash flow from operating activities (sub-total) (2009: SEK 741m, 2008: SEK 1,349m)

Operating activities, before interest and tax, contributed SEK 741m (1,349). This represents a decrease of SEK 608m after adjustment for gains on property sales of SEK 89m, reported under the sale of each type of property, and elimination of non-cash items. Cash flow from operating activities deteriorated compared with the previous year because of fewer project starts combined with lower margins.

Cash flow from operating activities before change in working capital

(2009: SEK 695m, 2008: SEK 1, 232m)

Net interest received and paid decreased from SEK 15m in 2008 to SEK –119m in 2009, attributable in part to reduced interest income due to generally lower interest rates and in part to on average higher interest-bearing liability in 2009.

Taxes repaid/paid decreased from –132m in 2008 to SEK 73m in 2009.

Net development properties etc. (including participations in tenant-owners associations) (2009: SEK 241m, 2008: SEK –1,227m)

JM invested in new development properties for SEK 428m (1,571). At the same time, SEK 910m (781) went into production in conjunction with project starts. During the year the Group increased its holdings of participations in tenant-owners associations with a negative net flow of SEK –186m (–148).

Current receivables and liabilities

(2009: SEK –344m, 2008: SEK 187m) The change in current receivables and liabilities had a total negative effect on cash flow of SEK –531m (30) compared with the previous year.

Net project properties

(2009: SEK 532m, 2008: SEK –91m)

The Group sold project properties for SEK 532m, which had a positive effect at the same time that receivables for property sales decreased by SEK 366m, which had an aggregate positive effect on cash flow of SEK 898m.

FINANCING ACTIVITIES

(2009: SEK –158m, 2008: SEK –1,055m) JM did not pay any dividend to shareholders in 2009, nor did it have any redemption program. Interest-bearing liabilities decreased net with SEK 158m.

ADJUSTMENT FOR NON -CASH ITEMS	2009	2008
Gains on the sale of properties	–89	–73
Changes in pension liability	52	14
Other provisions etc.	14	–5
Total	–23	–64
INVESTMENTS IN DEVELOPMENT PROPERTIES , ETC	2009	2008
Investment in development properties	–428	–1,571
Acquisition of participations in tenant-owners associations	–1,519	–316
Change in promissory note	–207	–347
Total	–2,154	–2,234
PAYMENT ON ACCOUNT FOR DEVELOPMENT PROPERTIES , ETC	2009	2008
Payment on account for development properties	910	781
Sale of development properties	133	198
Change in receivables, development properties sold, etc.	16	–220
Sale of participations in tenant-owners associations	1,336	248
Total	2,395	1,007
INVESTMENT IN PRO JECT PROPERTIES , ETC	2009	2008
Investment in project properties	–453	–314
Change in promissory note	79	75
Adjustment for capitalized interest	8	5
Total	–366	–234
SALE OF PRO JECT PROPERTIES , ETC	2009	2008
Sale of project properties	532	550
Changes in receivables	366	–407
Total	898	143

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY , SE Km	Share capital	Additional paid in capital	Translation reserves	Undistributed earnings	Total share holders' equity
Opening balance January 1, 2008	89	750	24	3,030	3,893
Transfer	-	7	-	–7	-
Adjusted opening balance	89	757	24	3,023	3,893
Net profit for the year	-	-	-	818	818
Translation difference for the year	-	-	20	-	20
Comprehensive income for the year	-	-	20	818	838
Redemption of own shares	–6	-	-	–986	–992
Dividend to equity holders of the Parent Company	-	-	-	–489	–489
Equity component of convertible debentures	-	3	-	-	3
Share-based payments regulated with
equity instruments	-	-	-	3	3
Repurchase of own shares	-	-	-	–15	–15
Closing balance, December 31, 2008	83	760	44	2,354	3,241
Opening balance, January 1, 2009	83	760	44	2,354	3,241
Net profit for the year	-	-	-	379	379
Translation difference for the year	-	-	42	-	42
Comprehensive income for the year	-	-	42	379	421
Equity component of convertible debentures Share-based payments regulated with	-	3	-	-	3
equity instruments	-	-	-	3	3
Closing balance, December 31, 2009	83	763	86	2,736	3,668

Attributable to shareholders of the Parent Company

EQUITY

(2009: SEK 3,668m, 2008: SEK 3,241m) Shareholder's equity increased by SEK 427m compared with the outcome of 2008. Consolidated equity as of December 31, 2009, totaled SEK 3,668m (3,241), which corresponds with SEK 44 (39) per share. Return on equity is 11.0 percent (22.9).

Profit for the year

Please see the notes on the consolidated income statement, page 47.

Translation difference

The appreciation of the Swedish krona against the Danish krona DKK and the Euro EUR entailed a negative impact of SEK 15m and SEK 13m respectively as translation difference for the year in shareholders' equity. The depreciation of the Swedish krona against the Norwegian krona NO K entailed a positive impact of SEK 70m as translation difference for the year in shareholders' equity. The change for the year amounts to SEK 42m (20) and the accumulated translation difference in closing equity is SEK 86m (44).

Dividend to equity holders of the Parent Company

The dividend to equity holders of the Parent Company totaled SEK 0m (489), corresponding with SEK 0 (5.50) per share.

Equity component of convertible debentures

Convertible debentures were offered to JM employees during the year. In accordance with IAS 32 the liability and equity components are reported separately, which means that the debenture loan is reported in the balance sheet as a liability initially with the nominal amount excluding the equity component. Equity increased by SEK 3m upon conclusion of the subscription period.

Share-based payments

Share-based payments regulated with equity instruments have resulted in a charge against equity of SEK 3m.

Consolidated shareholders' equity in the balance sheet is classified as follows:

Share capital

Share capital includes the registered share capital for the Parent Company.

Additional paid in capital

Additional paid in capital includes transactions with shareholders. The transactions that have occurred are new issues at a premium and correspond with capital received in addition to the nominal amount.

Translation reserves

The reserves consist of translation differences attributable to translation of foreign subsidiaries according to IAS 21.

Undistributed earnings (including profit for the year)

Undistributed earnings (profit carried forward) including profit for the year corresponds with the accumulated total gains and losses generated for the Group.

notes—group		page			page
NOT e 1 NOT e 2	ACCOUNTING AND VALUATION PRINCIPLES CONSOLIDATED INCOME STATEMENT	53	NOT e 17	PRO JECT PROPERTIES AND DEVELOPMENT ­PROPERTIES	65
	BY ­SEGMENT	56	NOT e 18	PARTICIPATIONS IN TENANT -OWNERS
NOT e 2	CONSOLIDATED balance sheet BY ­SEGMENT	57	NOT e 19	­ASSOCIATIONS ETC OTHER CURRENT RECEIVABLES	65 65
NOT e 3	EMPLOYEES AND PERSONNEL COSTS	58	NOT e 20	RECOGNI ZED REVENUE LESS PROGRESS
NOT e 4	DEPRECIATION ACCORDING TO PLAN	60		­BILLINGS	65
NOT e 5	FEES AND REMUNERATION TO AUDITORS	60	NOT e 21	CASH AND CASH EQUIVALENTS	65
NOT e 6	GAINS ON THE SALE OF PROPERTIES	60	NOT e 22	INTEREST -BEARING LIABILITIES	65
NOT e 7	Write-downs on properties	60	NOT e 23	FINANCIAL RIS K MANAGEMENT AND ­FINANCIAL DERIVATIVE INSTRUMENTS	65
NOT e 8	FINANCIAL INCOME AND EXPENSES	60	NOT e 24	PROVISIONS FOR PENSIONS AND SIMILAR
NOT e 9	TA XES	60		­COMMITMENTS	67
NOT e 10	EARNINGS AND DIVIDEND PER SHARE	61	NOT e 25	OTHER PROVISIONS	68
NOT e 11	Goodwill	61	NOT e 26	DEFERRED TA X ASSETS AND LIABILITIES	68
NOT e 12	ROPERTY , PLANT , AND EQUIPMENT	62	NOT e 27	proGRESS BILLINGS IN EXCESS OF ­RECOGNI ZED REVENUE	68
NOT e 13	PARTICIPATIONS IN ASSOCIATES	62	NOT e 28	ACCRUALS AND DEFERRED INCOME	68
NOT e 14	PARTICIPATIONS IN ASSOCIATES	62	NOT e 29	PLEDGED ASSETS AND CONTINGENT
NOT e 15	FINANCIAL ASSETS	63		­LIABILITIES	68
NOT e 16	PARTICIPATIONS IN GROUP COMPANIES	63	NOT e 30	RELATED PARTY DISCLOSURES	68

NOTe 1 ACCOUNTING AND VALUATION PRINCIPLES

Amounts in SEK million unless stated otherwise

Corporate information

These annual accounts and consolidated accounts for JM AB have been approved by the Board and the President on February 25 and will be presented for adoption at the 2010 Annual General Meeting. JM AB is a Swedish public limited company listed on NA SDAQ OM X Stockholm, Mid Cap segment. The company has its registered office in Stockholm, Sweden.

Statement of compliance with applicable rules The consolidated accounts were prepared in accordance with the International Financial Reporting Standards (IFRS). Since the Parent Company is an enterprise within the EU , only EU -approved IFRS will be applied. Moreover, the consolidated accounts are prepared in compliance with Swedish law through the application of the Swedish Financial Reporting Board recommendation RFR 1.1 (Supplementary Accounting Regulations for Groups). The Parent Company's annual accounts have been prepared in compliance with Swedish law and with application of the Swedish Financial Reporting Board's recommendation RFR 2.1 (Reporting for Legal Entities). This means that IFRS valuation and disclosure rules are applied with those deviations that can be seen in the section about the Parent Company's accounting policies.

Basis for preparation of the accounts

The consolidated accounts are based on historical acquisition values, with the exception of certain financial instruments. Unless stated otherwise, all amounts are specified in millions of Swedish kronor (SEKm).

Basis for consolidation

The consolidated accounts include the Parent Company and its subsidiaries. The financial statements for the Parent Company and the subsidiaries that are included in the consolidated accounts relate to the same period and have been prepared according to the accounting policies that apply for the Group. A subsidiary is included in the consolidated financial statements from the date on which the Parent Company acquires a controlling influence over the company, normally 50 percent of the votes, and is included in the consolidated financial statements until the date on which the controlling influence in the company ceases. Internal balances and profits and losses from internal transactions are eliminated.

New and changed accounting standards and interpretations

JM's accounting principles and methods of calculation for 2009 remain unchanged compared with 2008.

Changes in effect commencing in 2009 and approved by the EU

IFRS 8 Operating Segments

This standard contains disclosure requirements for the Group's operating segments and replaces the requirement defining primary and secondary segments based on business segments and geographic areas in accordance with IAS 14. The new standard requires information about the segment to be presented using a management approach, which means that segments will be identified on the basis of internal reports.

The new standard does not involve any changes for JM .

Revised IAS 1 Presentation of financial statements As a result of the revised IAS 1 Presentation of financial statements, all revenue and expense items previously recognized as changes in equity are now recognized in the income statement. In addition, reporting of changes in equity only includes details concerning

owner-related transactions. Revised IAS 23 Borrowing costs

The revised version requires capitalization of borrowing costs that are directly attributable to the purchase, construction or production of an asset, which by necessity requires a significant amount of time to complete for intended use or sale.

The changed standard does not involve any changes for JM .

Changes in effect commencing in 2010 and approved by the EU

IFRIC 12 Service concession arrangements The interpretation applies to private sector operators that have concessions for the supply of public services and describes the accounting for the obligations they undertake and rights they receive in service concession arrangements. JM does not engage in such activities. The new standard therefore will not affect JM 's accounting.

IFRIC 15 Agreements for the Construction of Real Estate

IFRIC 15 Agreements for the Construction of Real Estate will be applied from 2010. The interpretation describes when and how to report revenues and associated expenses associated with the sale of property, if there is a purchase agreement between contractor and buyer before construction is complete. Moreover, guidance is provided on whether to report the agreement in accordance with IAS 11 Construction contracts, with percentage of completion method, or IAS 18 Revenue, usually at transfer of ownership.

The interpretation affects JM 's main operations, residential development projects. IFRIC 15 does not involve any change in accounting of JM 's Swedish residential development projects, where IAS 11 Construction contract will continue to be applied. IAS 18 Revenue will be applied from 2010 for JM 's residential development projects outside Sweden. This change will involve certain effects at restatement of the comparative income statement and balance sheet for 2009. The JM Group's restated operating profit for 2009 will decrease by about SEK 20m and equity as of Dec. 31, 2009, will decrease by about SEK 30m. Segment accounting and project management of JM 's foreign operations, like the Swedish business, will also continue to be done based on IAS 11.

Revised IFRS 3 Business Combinations and revised IAS 27 Consolidated and Separate Financial Statements

IFRS 3 introduces a number of changes in reporting of Business Combinations effective from 2010, which will affect the size of recognized goodwill, reported earnings in the period that the acquisition is made and future reported earnings.

Note 1 cont'd.

According to revised IAS 27, changes in the parent companies ownership that does not result in loss of control, are recognized as equity transactions. The changes in IFRS 3 and IAS 27 will affect reporting of future acquisitions, loss of control and transactions with minority shareholders.

Estimates and assumptions

The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the reported amounts of revenue and expenses, as well as other information disclosed.  Actual results could differ from those estimates, which can be seen in particular in the field of revenue and income recognition relating to the percentage of completion method in residential projects, where reported profits and financial position for each period are based to some extent on these evaluations and assumptions.

Reporting of employee benefits/ pensions and provisions for guarantees are also largely based on evaluations and assumptions.

The value of pension commitments for defined benefit pension plans is based on actuarial calculations using assumptions about discount rates, anticipated return on plan assets, future salary increases, inflation and demographic conditions.

Provisions for future expenses due to guarantee commitments are based on calculated expenses that have historically provided a reliable provision. See also the "Write-downs" section.

Current and non-current liabilities, current and non-current assets

Liabilities and provisions in the balance sheet are reported as current or non-current. Current liabilities are debts that will be settled within twelve months of the balance sheet date; the same applies to the breakdown between current and non-current assets.

Business combinations

According to IFRS 3, the fair value of identifiable assets and liabilities in the acquired business is established at the time of acquisition.  These fair values also include the percentage of assets and liabilities that are attributable to any remaining minority shareholders in the acquired business. Identifiable assets and liabilities also include assets, liabilities and provisions, including commitments and claims from outside parties, which are not recognized on the balance sheet of the acquired business.  The difference between the cost of the acquisition and the acquired share of net assets in the acquired business is classified as goodwill and recognized as an intangible asset in the balance sheet.

Associated companies

Companies in which the Group has a significant influence, which is assumed when the holding amounts to at least 20 percent and not more than 50 percent of the voting rights, are reported as associates.  This also assumes that ownership is part of a lasting connection and that the holding is not a joint venture.  Associates are included in the consolidated accounts according to the equity method. JM 's holding of associates is negligible.

Joint ventures

Companies that are not subsidiaries and which conduct operations in consortium-like forms, i.e. with joint ownership and control, are consolidated according to the proportional method. JM 's joint ventures are limited in scope.

Translation of foreign operations

All foreign group companies conduct their business activities in the local currency of the respective country, which is the functional currency of the respective company. Balance sheets and income statements are translated to the Group's reporting currency (SEK) according to the current method.  According to the current method, all assets, provisions, and other liabilities are restated at closing rate of exchange and all items in the income statement are restated using the average exchange rate for the year.  Translation differences thus arising are transferred directly to the translation reserve in equity, as are any translation differences in those financial instrument held to hedge these net assets. In the event of a sale of a foreign business, the accumulated translation difference is recognized in the income statement.

Receivables and liabilities in foreign currency

Transactions in foreign currencies (currency other than each company's functional currency), are reported at the conversion rate on the transaction date. Monetary receivables and liabilities in foreign currencies are valued at the exchange rate applying on the balance sheet date. Exchange rate differences are reported in the income statement.

Segment reporting

The Group's operations are divided into five business segments: JM Residential Stockholm, JM Residential Sweden, JM Property Development, JM Production and JM International, which also comprise the reportable segments for the JM Group in accordance with IFRS 8. This division into business segments is based on the Group's operating divisions, which are based on geographical segments combined with differences between products and services provided. The President regularly uses internal reporting from the business segments to allocate resources to the segments and to assess the performance of the segments.

Gains on the sale of properties

Sales of project properties and development properties that are not the object of project development are usually recognized on the income statement in the period during which the parties entered into a binding sale agreement. Gains from land sales in conjunction with residential development projects are included in the reporting for the entire residential project.

Revenue and profit from residential project development

Project revenues relating to contracting and residential development projects are reported in compliance with IAS 11 Construction Contracts.  The Swedish Construction Federation Industry recommendation relating to the percentage of completion method for residential projects for sale applies in this case.  This recommendation, which is a clarification of IAS 11, prescribes revenue recognition that is based on stage of completion multiplied by sales rate.  This means that a stage of completion of 50 percent and a sales rate of 50 percent is recognized as 25 percent of the forecast final gains in the project.  The percentage of completion method is based on the view that an assignment is carried out in pace with completion of the respective project. Revenue and profit in the project are reported period-by-period, in pace with recognition, providing a direct link between financial reporting and the operations conducted during the period. Stage of completion is mainly determined based on project expenses incurred in relation to total estimated project expenses. "Sales" refers to the number of residential units sold based on binding contracts with end customers. Revaluations (changes in forecasts) of anticipated project revenues lead to adjustment of previously recognized revenue in the project concerned.  This adjustment is included in the net profit for the period.  Anticipated losses are charged against the profit for the period in full. Revenue recognition according to the percentage of completion method is carried out from the preliminary stage of the project if reliable estimation can be made and continues according to the same principle until the project is completed.  The Parent Company also applies the percentage of completion method. Most of JM 's operations pertain to housing projects conducted by JM for subsequent sale.  These operations consist of projects on JM 's own land for production of housing for sale as tenant-owned/freehold apartments or tracts of single-family homes for sale directly to consumers. In residential project development JM usually owns the development property at the start of the project. When production begins, the property with the carrying amount is transferred to the project and included among the project's other production costs. Interest expenses are included among production costs from the start of production.

Income tax

The heading "Taxes" in the income statement includes current and deferred income tax for Swedish and foreign group divisions.  The companies in the Group are liable for tax according to existing legislation in each country.  The state income tax rate in Sweden was 26.3 percent during the year. Current tax is calculated on nominal book profit with an addition for non-deductible items and a deduction for non-taxable income and other deductions.  The balance sheet method is applied to accounting for deferred tax.  According to this method deferred tax liabilities and assets are reported for temporary differences between carrying amounts and fiscal values respectively for assets and liabilities and for other fiscal deductions or deficits. Deferred tax assets are recognized net against deferred tax liabilities if they can be used against deferred tax liabilities. Deferred tax liabilities and tax assets are calculated on the basis of the actual tax rate.  The effects of changes in applicable tax rates are taken against income in the period the change becomes law. Deferred tax assets are reduced to the extent that it is not probable that the underlying tax asset can be realized within the foreseeable future.

Intangible assets (goodwill)

The useful life of each intangible asset is set and written off over the useful life of the asset. If the useful life of the asset is assessed to be indeterminate it is not amortized.  An assessment that concludes that an intangible asset has an indeterminate useful life considers all relevant conditions and is based on the fact that there is no predictable maximum time limit for the net cash flow that the asset generates. Goodwill has an indefinite useful life. The need for impairment is tested at least annually for intangible assets, including goodwill, with an indeterminate useful life. Goodwill is tested for impairment as described below. Goodwill value, which is established at the time of acquisition, is allocated among cash-generating units, or groups of cash-generating units. Each such cash flow to which goodwill is allocated corresponds with the lowest level within the Group at which goodwill is monitored in the company's governance and is not a larger part of the Group than a segment.  An impairment loss is present when the recoverable amount relating to a cash-generating unit (or groups of cash-generating units) is less than the carrying amount.  A write-down is then reported in the income statement.

Plant, property, and equipment

Plant, property and equipment are recognized at cost after deduction for accumulated depreciation and write-downs, if any. Depreciation according to plan is applied on a straight-line basis and based on the cost and assessed useful life of the assets.

Project and development properties

Project properties are all properties that are not classified as development properties as described below. JM does not own properties for long-term management. Project properties must be sold after they are fully developed and are therefore classified as current assets and valued according to IAS 2 Inventory. Production costs for JM 's fully developed properties include both direct costs and a reasonable share of indirect costs. Interest expenses pertaining to production of project properties are recognized as an expense in the Parent Company. In the consolidated accounts the same amount is added to the cost of project properties. Properties, undeveloped or developed, that are intended for production of tenant-owned apartments/ freehold apartments or single-family homes and land for investment properties are classified as development properties. The properties are usually sold soon after production begins. Development properties are reported in accordance with IAS 2 Inventory. Project and development properties are usually recognized as assets in the accounting period during which the parties entered into a binding acquisition agreement.

Note 1 cont'd.

Borrowing costs

Borrowing costs are included in the consolidated accounts in the acquisition cost of buildings in progress (project properties). In general, borrowing costs added to acquisition cost are limited to assets that take a significant time for completion which in the Group's case comprise construction of project properties. Interest expenses are included in the acquisition value until the time that the building is complete. If special borrowing arrangements were made for the project the actual average borrowing cost is used. In other cases the borrowing cost is calculated based on the Group's actual average borrowing cost.

Write-downs

If on the balance sheet date there is any indication of impairment of the value of plant, property or equipment, or an intangible asset, a calculation is performed of the recoverable amount of the asset.  The recoverable amount is the higher of fair value less costs to sell and value in use. If the estimated recoverable amount is lower than the carrying amount, an impairment loss is recognized to the asset's recoverable amount.  An impairment loss is reversed when the basis for the impairment, wholly or partly, no longer exists.  The term impairment loss is also used in conjunction with revaluation of properties reported as current assets. Valuation of these properties is performed item by item (property by property) according to the lower of cost or market principle; i.e. the lower of cost and net realizable value.

Net realizable value is the estimated sales price in the ordinary course of business, less estimated costs for completion and effecting a sale.

Net realizable value for development properties is based on internal project evaluations where assumptions are made about the project's expected revenues and expenses.  The future cash flow of the project is discounted by a discount rate.  Those projects (development properties) that demonstrate a negative present value based on discounting become the object of impairment. See also "Intangible assets (goodwill)".

Leases

Leases are classified as either finance or operating leases.  A finance lease exists when the economic risks and benefits associated with ownership are, in essence, transferred to the lessee; if this is not the case, it is classified as an operating lease. Briefly, a finance lease means that the object is recognized as an asset in the balance sheet of the lessee, while a matching liability is recognized as a liability item in the balance sheet. In an operational lease, the object is recognized in the balance sheet of the lessor. Lease fees in operational leases are recognized linearly over the term of the agreement. JM 's holdings of leases with JM as lessee are of limited scope.

Employee benefits/pensions

Employee benefits are reported in accordance with IAS 19, Employee Benefits.  A distinction is made between defined contribution pension plans and defined benefit pension plans relating to post-employment benefits. Defined contribution pension plans are defined as plans where the company pays set charges to a separate legal entity and does not have any obligation to pay additional charges even if the legal entity does not have sufficient assets to pay the benefits to employees attributable to their service until the reporting date. Other pension plans are defined benefit. Obligations and costs relating to defined benefit pension plans are calculated according to the Projected Unit Credit Method.  The intention is that anticipated future pension payments should be expensed evenly distributed over the employee's period of service.  Anticipated future salary increases and anticipated inflation are included in the calculation.  The present value of obligations is discounted in the first place based on a market return on first-class corporate bonds on the reporting date. In Sweden and Norway, where there is no functioning market for such bonds, the market return on government bonds is used and a premium for a longer maturity added based on the duration of the pension obligations.  The fair value of obligations is deducted from the estimated value of the obligations. In order to avoid substantial fluctuations in pension costs between years, changes within a certain level (known as the corridor) can be left unrecognized in the income statement and in the balance sheet.  The corridor means that actuarial gains and losses only affect the Group's profit or loss to the extent that they exceed the higher of 10 percent of the present value of pension obligations compared and 10 percent of the fair value of the plan assets. Excess amounts (outside the corridor) are allocated over the average remaining length of employment.  The recognized return on plan assets relates to the estimated return at the beginning of the year and therefore usually differs from the actual return during the year.  This variance is an actuarial gain or loss.

Information about the Group's pension obligations is provided in Note 24. Independent actuaries conduct annual calculations relating to the defined benefit plans found at JM . Only an insignificant part of the Group's defined benefit pension obligations have been financed through premiums to Alecta. Since the requisite information cannot be obtained from Alecta, these pension obligations are reported as a defined contribution plan.  Taxes payable on pension costs, such as the Swedish payroll tax on pension costs, are taken into account when calculating pension obligations as described above, which is in accordance with pronouncement UFR 4 from the Swedish Financial Reporting Board, Accounting for special employer's contribution and yield tax.

Share-based payments

Approximately 50 senior executives in the Group have been offered the opportunity to participate in longterm variable salary programs, the share-matching plan and the performance share program.

Participation in the share matching plan requires an investment in JM common stock (contribution shares). For each contribution share the participant is granted the right to acquire one ordinary JM share (performance share) at an established redemption price, provided that certain performance requirements are met. In order to be eligible for the program the participant is required to have been employed at JM Group for a specific period of time and kept all contribution shares during this period.

Participants in the performance share program receive, free of charge and with no requirement for investment in contribution shares, a certain number of rights. Each right entitles the holder to acquire at a future point in time one ordinary share in JM (performance share) at an established redemption price, provided that certain performance requirements are met. In order to exercise the right to acquire a performance share the participant must be employed by JM during an initial vesting period and certain performance requirements, linked to JM 's growth in earnings per share, must be met.

The fair value of the right for the share matching plan and performance share program is determined on the grant date. Measurement, which is based on the price of the ordinary share on the grant date, takes into account the redemption price as well as the fact that the participant does not receive any return on the performance share during the vesting period.

Total fair values of the granted rights expected to be earned during the vesting period are reported as an expense in the income statement with a corresponding increase in retained earnings.  The expense will be recognized in the income statement over the vesting period. Exercise of the rights will mean that JM must pay social security expenses. Provisions are being made for the assessed future social security expenses and the expense will be recognized in the income statement over the vesting period.

Financial instruments

Financial assets and financial liabilities are classified in different categories and are then recognized and measured according to the principles that apply to each category. Short-term investments are classified as assets that are measured at fair value and where changes in value are recognized in the income statement. Financial liabilities are measured at amortized cost.  This is calculated so that a constant effective interest is obtained over the borrowing period provided maturities are not short.  Accounts payable and similar current liabilities are thus recognized at nominal amounts. Financial derivative instruments are recognized in the balance sheet at fair value. Changes in value are recognized in the income statement.  The Group's policy is that derivatives may only be held for hedging purposes. Hedge accounting, in which changes in value of derivatives are recognized directly in equity and later transferred to offset the hedged item, is not applied. JM has no or only negligible holdings of derivative instruments.

Provisions and contingent liabilities

Provisions are reported when JM has a commitment as a result of events that have occurred and where it is probable that payments will be required in order to meet the commitment. Moreover, it must be possible to reliably estimate the amount that will be paid. Provisions are made for future costs on the basis of guarantee commitments.  This calculation is based on the estimated costs for the project concerned or for a group of similar projects, calculated according to a ratio that historically provided a reliable provision for these costs.  The same ratio can for example function as a proportion of income or estimated cost per completed residential unit. Contingent liabilities are possible commitments originating from events that have occurred and whose existence will be confirmed only by the occurrence or lack thereof of one or more uncertain future events, which are not completely in the company's control. Obligations that originate from events that have occurred, but that are not recognized as liabilities or provisions, because it is not probable that an outflow of resources will be required to settle the obligation or because the size of the obligations cannot be reliably estimated, are also recognized as contingent liabilities.

Cash flow statement

The cash flow statement has been prepared according to the indirect method.  The analysis has been adapted to JM 's operations. Since buying and selling project and development properties are included in JM 's ongoing activities, these are reported under the corresponding sections of the cash flow statement.  The item "Payment on account for project properties" mainly refers to utilization of properties for production and is matched by a cash flow in the form of invoicing. Buying and selling of plant, property and equipment not pertaining to properties are reported under "Investing activities, other." Cash and cash equivalents are classified as cash and bank balances and short-term financial investments that are traded on the open market at known amounts and are associated with only marginal risk for value fluctuations. Cash and cash equivalents include short-term investments with a maturity of less than three months from the acquisition date.  Taxes and interests paid for the year are reported in full under operating activities.

Parent Company's Accounting Policies

The Parent Company's accounting policies deviate from the Group's on the following points: Defined benefit pension plans are reported based on the regulations in the Swedish Law on Safeguarding of Pension Commitments. Untaxed reserves are reported in their entirety without being allocated between shareholders' equity and deferred tax. Participations in subsidiaries, associate companies and joint ventures are recognized at cost of acquisition less any impairment losses. In the Parent Company borrowing costs relating to buildings under construction (project properties) are expensed and recognized as a financial cost in the income statement. Mergers are reported in accordance with BFNAR 2003:2, general advice from the Swedish Accounting Standards Board. In the Parent Company, mergers of wholly owned group companies are reported according to the consolidated value method, in which all assets and liabilities are taken over at values based on the acquisition analysis carried out in connection with the original acquisition of the group company in question.  The merger difference is taken directly to shareholders' equity.

NOTe 2 SEGMENT INFORMATION

The JM Group's business is managed and reported by business segment as set out below.

• The JM Residential Stockholm business segment develops residential projects in Greater Stockholm. • The JM Residential Sweden business segment devel-
• ops residential projects in growth areas in Sweden, excluding Greater Stockholm. Contracting operations are also conducted to a limited extent.
• The JM Property Development business segment develops residential and commercial properties in Greater Stockholm.
• The JM Production business segment carries out construction work for external and internal customers in the Greater Stockholm area.
• The JM International business segment develops and sells residential properties in Norway, Denmark, Finland and Belgium.

No segments have been aggregated to form the above reportable business segments. Identification of reportable segments is based on internal reporting to the chief operating decision maker, which in the JM group is the chief executive officer of the parent company (who is also the president). The reporting format for segment reporting is based on geographical segments and focus of operation.

The chief operating decision-maker primarily uses the business segments' income, operating profit and operating margin, as well as operating capital and operational cash flow as a basis for resource allocation and assessment of the segment's result. The performance of the business segments is assessed and evaluated based on the indicators mentioned above.

Segment consolidation is done in accordance with the same principles as for the Group in its entirety. However, group-wide sales and administrative expenses, financial expenses, financial income and income taxes are mainly handled at group level and not allocated to segments.

Transactions between business segments based on market conditions.

CONSOLIDATED INCOME STATEMENT BY BUSINESS SEGMENT

	JM	JM	JM		Unallo				Unallo
	Residen	Residen	Property	JM	cated	Sub	JM	Sub	cated
	tial	tial	Develop	Produc	items	total	Interna	total	items	Total
Group 2009	Stockholm	Sweden	ment	tion	Sweden	2) Sweden	tional	Group	Group 3)4)	Group
Revenues—external	3,330	2,296	309	1,490	-	7,425	1,353	8,778	-	8,778
Revenues—internal	-	-	-	518	–518	-	-	-	-	-
Total revenues	3,330	2,296	309	2,008	–518	7,425	1,353	8,778	-	8,778
Production and operating costs 1)	–2,612	–1,998	–252	–1,826	518	–6,170	–1,331	–7,501	-	–7,501
Gross profit	718	298	57	182	-	1,255	22	1,277	-	1,277
Selling and administrative expenses 1)	–224	–132	–22	–52	-	–430	–139	–569	–46	–615
Gains on the sale of properties	2	0	75	-	-	77	12	89	-	89
Impairment losses on properties	-	-	-	-	-	-	–87	–87	-	–87
Operating profit	496	166	110	130	-	902	–192	710	–46	664
Financial income and expenses									–117	–117
Net profit/loss before taxes								710	–163	547
Taxes									–168	–168
Net profit for the year								710	–331	379
Operating margin (%)	14.9	7.2		6.5			–14.2			7.6
1) Of which: depreciation of property, plant,
and equipment	–1	–1	0	0	-	–2	–7	–9	–4	–13
Group 2008
Revenues—external	5,317	3,263	213	1,378	-	10,171	2,058	12,229	-	12,229
Revenues—internal	-	-	-	630	–630	-	-	-	-	-
Total revenues	5,317	3,263	213	2,008	–630	10,171	2,058	12,229	-	12,229
Production and operating costs 1)	–4,028	–2,843	–180	–1,839	630	–8,260	–1,920	–10,180	-	–10,180
Gross profit	1,289	420	33	169	-	1,911	138	2,049	-	2,049
Selling and administrative expenses 1)	–229	–182	–32	–45	-	–488	–174	–662	–57	–719
Gains on the sale of properties	-	–1	74	-	-	73	-	73	-	73
Impairment losses on properties	–140	–40	-	-	-	–180	–140	–320	-	–320
Operating profit	920	197	75	124	-	1,316	–176	1,140	–57	1,083
Financial income and expenses									–31	–31
Net profit/loss before taxes								1,140	–88	1,052
Taxes									–234	–234
Net profit for the year								1,140	–322	818

Operating margin (%) 17.3 6.0 6.2 –8.6 8,9 1) Of which: depreciation of property, plant, and equipment –2 –1 - –1 - –4 –4 –8 –2 –10

OPERATING CASH FLOW BY BUSINESS SEGMENT

Note 2 cont'd.

CONSOLIDATED BALANCE SHEET BY SEGMENT

	JM	JM	JM					Unallo
	Residen	Residen	Property	JM	Sub	JM	Sub	cated
	tial	tial	develop	Produc	total	Interna	total	items	Total
Group Dec 31, 2009	Stockholm	Sweden	ment	tion	Sweden	tional	Group	Group 5)6)	Group
ASSETS
Non-current assets	-	-	-	-	-	62	62	196	258
Project properties	-	-	564	-	564	32	596	-	596
Development properties	2,111	1,451	108	-	3,670	1,320	4,990	-	4,990
Participations in tenant-owners associations, etc.	73	75	-	-	148	205	353	-	353
Current receivables	346	483	30	187	1,046	412	1,458	245	1,703
Cash and cash equivalents	-	-	-	-	-	-	-	2,030	2,030
Total current assets	2,530	2,009	702	187	5,428	1,969	7,397	2,275	9,672
TOTAL ASSETS	2,530	2,009	702	187	5,428	2,031	7,459	2,471	9,930
EQUITY AND LIABILITIES
Equity	-	-	-	-	-	-	-	3,668	3,668
Long-term liabilities	-	-	-	-	-	-	-	2,132	2,132
Current liabilities	737	427	34	335	1,533	80	1,613	2,517	4,130
TOTAL EQUITY AND LIABILITIES	737	427	34	335	1,533	80	1,613	8,317	9,930
Total operating capital by business segment	1,793	1,582	668	–148	-	1,951	-	-	-
Investment in property, plant, and equipment	-	-	-	-	-	-	-	9	9
Group Dec 31, 2008
ASSETS
Non-current assets	-	-	-	-	-	56	56	128	184
Project properties	-	-	553	-	553	61	614	-	614
Development properties	2,432	1,546	80	-	4,058	1,562	5,620	-	5,620
Participations in tenant-owners associations, etc.	95	36	-	-	131	40	171	-	171
Current receivables	372	501	562	277	1,712	330	2,042	313	2,355
Cash and cash equivalents	-	-	-	-	-	-	-	1,111	1,111
Total current assets	2,899	2,083	1,195	277	6,454	1,993	8,447	1,424	9,871
TOTAL ASSETS	2,899	2,083	1,195	277	6,454	2,049	8,503	1,552	10,055
EQUITY AND LIABILITIES
Equity	-	-	-	-	-	-	-	3,241	3,241
Long-term liabilities	-	-	-	-	-	-	-	2,164	2,164
Current liabilities	922	563	13	383	1,881	139	2,020	2,630	4,650
TOTAL EQUITY AND LIABILITIES	922	563	13	383	1,881	139	2,020	8,035	10,055
Total operating capital by business segment	1,977	1,520	1,182	–106	-	1,910	-	-	-
Investment in property, plant, and equipment	-	-	-	-	-	-	-	13	13
	JM	JM	JM
	Residen	Residen	Property	JM		JM
	tial	tial	develop	Produc		Interna
Operating cash flow by segment	Stockholm	Sweden	ment	tion		tional
2009	544	70	620	173		–174

Income by country 7)	Sweden	Norway	Denmark	Finland	Belgium	Total
2009	7,425	1,150	89	3	111	8,778
2008	10,171	1,311	579	37	131	12,229

2)  Elimination within Sweden comprises intragroup invoicing between business segments. 3) Unallocated items within the Group pertain to group-wide costs.

4) Financial income and expenses, as well as tax, are not allocated by business segment, but reported as unallocated items.

2008 1,090 –203 –113 162 –657

5) The assets and liabilities and shareholders' equity that are not included in JM 's definition of operating capital are not allocated by business segment.

They are reported as unallocated items mainly because they cannot be allocated in a fair and reasonable manner.

6) Plant, property and equipment are not included in JM 's definition of operating capital and these investments are therefore reported as an unallocated item.

7) All revenues are external.

NOTe 3 EMPLOYEES AND PERSONNEL COSTS

		of which		of which
Average number of employees, by country	2009	men, %	2008	men, %
Sweden	1,848	84	2,180	84
Norway	208	82	294	85
Denmark	17	59	31	45
Finland	7	57	12	58
Belgium	15	60	16	63
Total	2,095	83	2,533	83

		2009			2008
Wages, salaries, other remuneration	Wages, salaries and	Social security		Wages, salaries and	Social security
and social security expenses	remunerations	expenses	Total	remunerations	expenses	Total
Group	969	458	1,427	1,086	480	1,566
(of which pension costs)		(171)1)			(148)1)

1) SEK 3.5m (4.6) of the Group's pension costs pertain to the Group Board of Directors and President. The Group's outstanding pension commitments to them amount to SEK 0.4m (0.4).

		2009			2008
Wages, salaries and other remuneration by country and distribution between the Board and President and other employees	Board of ­Directors and President	Other employees	Total	Board of ­Directors and President	Other employees	Total
Sweden	9	798	807	10	880	890
(variable compensation)	(1)	(61)	(62)	(2)	(72)	(74)
Norway	3	128	131	3	149	152
(variable compensation)	(0)	(4)	(4)	(1)	(3)	(4)
Denmark	1	15	16	2	22	24
(variable compensation)	(0)	(0)	(0)	(0)	(2)	(2)
Finland	3	5	8	3	8	11
(variable compensation)	(1)	(1)	(2)	(0)	(1)	(1)
Belgium	1	6	7	1	8	9
(variable compensation)	(0)	(1)	(1)	(-)	(-)	(-)
Total Group	17	952	969	19	1,067	1,086
(variable compensation)	(2)	(67)	(69)	(3)	(78)	(81)

Employees and personnel costs

Compensation Committee

JM has had a Compensation Committee since February 2003.

Compensation to the Board of Directors

JM's Board, excluding the President, consists of a total of ten persons, eight men and two women. Six of these ten persons were elected by the Annual General Meeting, four men and two women. The other four are employee representatives, all of whom are men. The Chairman of the Board was paid a total of SEK 700,000 (688,000) in board fees. The other non-executive board members (five persons) were paid SEK 1,838,000 (1,947,000).

Compensation to the President and Executive Management

Compensation to the President and other members of Executive Management comprises basic salary, variable

compensation, other benefits and pension provisions. Compensation to the President is drafted by the Compensation Committee and decided by the Board. Compensation for other members of Executive Management is decided by the Compensation Committee. The combined remuneration must be competitive in the labor market in which the executive is active.

The short-term variable compensation to the President for the 2010 financial year will be determined as follows: 60 percent will be based on the financial result for the Group, 30 percent on earnings per share, and 10 percent on JM 's Customer Satisfaction Index (CSI). The short-term variable compensation for the President for 2010 may amount to a maximum of SEK 2,100,000. Total short-term variable compensation for the 2009 financial year was SEK 1,536,000 (524,000) to be paid during the spring of 2010. Short-term variable compensation for other members of Executive Management is based, depending on position, on the financial performance of the Group and the business units, earnings per share, and the CSI. Short-term variable compensation varies between three and six monthly salaries, depending on position. The short-term variable compensation for other members of Executive Management for 2010 may amount to a maximum of SEK 4.4m. Total shortterm variable compensation for other members of Executive Management for the 2009 financial year was SEK 3.5m (2.5), to be paid during the spring of 2010.

In addition, since 2009, a long-term variable salary program that amounts to 30 percent of fixed salary is available for members of Executive Management (including the President). The outcome is based on the Group financial performance in 2011 and may be paid in the spring of 2012, with a maximum of SEK 1,224,000 for the President and SEK 3.2m for other members of Executive Management.

Share match program and performance share program

No new share match or performance share programs were carried out in 2009.

The 2008 annual meeting of shareholders approved a share match program and a performance share program and the 2007 annual meeting of shareholders approved a share match program. The programs cover up to 50 senior executives. The purpose of the programs is to ensure long-term commitment among the senior executives and to further align the interests of the senior executives with those of the shareholders.

The 2008 share match program and performance share program cover 50,406 ordinary shares, equivalent to dilution of about 0.06 percent of shares and votes in the Company. The cost of the 2008 share match program and performance share program, which is charged against earnings during the three-year vesting period, will be approx. SEK 7m including social security expenses.

The 2007 share match program cover 20,568 shares, equivalent to dilution of about 0.03 percent of shares and votes in the Company. The cost of the 2007 share match program, which is charged against earnings during the three-year vesting period, is approx. SEK 7m including social security expenses.

For more information please see the summary on page 59.

Pensions

The President is entitled to an annual premium provision of 35 percent of basic salary. In addition, the Company pays for part of the President's health insurance premiums, with a salary ceiling of 50 times the income base amount. The Company has also pledged, as a possible supplement, to pay survivor's pension to the extent that survivor's pensions do not total 50 percent of basic salary. The Company would pay this supplement until such time that the President would have reached the age of 65. If the President is employed by the Company when he reaches the age of 60, either party is entitled to request that the President leave his position as President and CEO .

The members of Executive Management, excluding the President, are covered by the ITP plan and within its framework, by the Company's offer of an alternative ITP plan. Executive Management is also covered by a premium-based supplementary plan with an annual premium provision of SEK 50,000–120,000. Retirement age is 65. A few members of Executive Management are entitled to retire at the age of 60 with 70 percent of basic salary until the day on which they turn 65.

Notice periods / Severance pay

The period of notice for the President is 12 months in the event of termination by the Company. If no other employment has been secured by the end of the notice period, compensation shall be paid for an additional 12 months. In the event of termination by the President, the notice period is six months. No additional compensation will be paid after the six months. The other members of Executive Management have the same agreement as the President (six months mutual term of notice and six months severance pay if termination is initiated by JM ). A few members of Executive Management have notice periods of 24 months on termination by the Company and 12 months on termination by the employee.

Note 3 cont'd.

Summary of basic and variable compensation and pensions to the Board and Executive Management in 2009 and 2008.

			2009
SE K 000s	Basic salary/ Board fee	Variable compensation1)	Fair value share matching and performance share programs	Other benefits	Pension costs	Total
Chairman of the Board
Lars Lundquist	700	-	-	-	-	700
Other directors
Berthold Lindqvist	370	-	-	-	-	370
Elisabet Annell	340	-	-	-	-	340
Eva-Britt Gustafsson	170	-	-	-	-	170
Bengt Larsson	158	-	-	-	-	158
Anders Narvinger	170	-	-	-	-	170
Torbjörn Torell	315	-	-	-	-	315
Åsa Söderström Jerring	370	-	-	-	-	370
President	4,164	524	-	202	1,428	6,318
Others in Executive Management 2)	10,936	2,500	-	492	4,698	18,626
Total	17,693	3,024	-	694	6,126	27,537

1) The variable compensation reported in the table relates to amounts paid in 2009. All payments in 2009 are attributable to the 2008 financial year.

2) JM 's Executive Management, excluding the President, comprised a total of eight persons in 2009, six men and two women.

			2008
SE K 000s	Basic salary/ Board fee	Variable compensation1)	Fair value share matching and performance share programs 3)	Other benefits	Pension costs	Total
Chairman of the Board
Lars Lundquist	688	-	-	-	-	688
Other directors
Berthold Lindqvist	360	-	-	-	-	360
Elisabet  Annell	333	-	-	-	-	333
Eva-Britt Gustafsson	333	-	-	-	-	333
Bengt Larsson	307	-	-	-	-	307
Torbjörn Torell	307	-	-	-	-	307
Åsa Söderström Jerring	307	-	-	-	-	307
President	4,248	2,195	471	273	1,432	8,619
Others in Executive ­Management 2)	15,115	6,214	1,889	804	5,165	29,187
Total	21,998	8,409	2,360	1,077	6,597	40,441

1) The variable compensation reported in the table relates to amounts paid in 2008. All payments in 2008 are attributable to the 2007 financial year.

2) JM 's Executive Management, excluding the President, comprised a total of ten persons in 2008, eight men and two women.

3) The figure refers to the total allotment for 2008. Eligibility for redemption of shares requires an additional three years of employment. The expensed component of the allotted value for 2008 is about 20 percent of the stated value. This value is based on the theoretical calculated value during the grant period and has been calculated by a third party.

Share Match Program

Issued		Number right 1- shares	Number on	Right 1 shares redeemed	Right 1 shares due in	Number of Right 1 shares per Dec 31	Percentage of total number outstanding	Fair value per share,	Re demp tion price,	Due	Vesting period
year	Holder	allocated	January 1	in 2009	2009	2009	shares	SE K	SE K	date	year
2007	President	2,701	2,701	-	-	2,701	0.003	258.24	10	2014-12-31	3
2007	Others in Executive ­Management 8,038		8,038	–2,647	-	5,391	0.006	258.24	10	2014-12-31	3
2007	Other	14,739	13,641	–1,165	-	12,476	0.015	258.24	10	2014-12-31	3
2008	President	550	550	-	-	550	0.001	107.66	10	2015-12-31	3
2008	Others in Executive ­Management 4,738		4,738	–845	-	3,893	0.005	107.66	10	2015-12-31	3
2008	Other	12,495	11,744	–1,731	-	10,013	0.012	107.66	10	2015-12-31	3
		43,261	41,412	–6,388	-	35,024	0.042

Performance share program

		Number		Right 2 shares	Right 2	Number of Right 2	Percentage of total		Re demp
		right 2	Number	redeemed	shares	shares per	number	Fair value	tion		Vesting
Issued		shares	on	in	due in	Dec 31	outstanding	per share,	price,	Due	period
year	Holder	allocated	January 1	2009	2009	2009	shares	SE K	SE K	date	year
2008	President	4,274	4,274	-	-	4,274	0.005	107.66	10	2011-12-31	3
2008	Others in Executive ­Management 14,599		14,599	–4,252	-	10,347	0.012	107.66	10	2011-12-31	3
2008	Other	24,577	24,137	–2,808	-	21,329	0.026	107.66	10	2011-12-31	3
		43,450	43,010	–7,060	-	35,950	0.043

Note 3 cont'd.

Convertible debentures for personnel

The 2009 Annual General Meeting resolved to offer all employees in the JM Group in Sweden a convertible subordinated debenture, and warrants for employees outside Sweden. The purpose of the issue of personnel convertibles and warrants was to boost long-term financial commitment to JM on the part of employees with increased motivation and reinforced loyalty to the Group. A total of 379,000 convertible bonds for a nominal amount of SEK 28m as well as 20,000 warrants were issued. The loan matures on June 17, 2013 and entitles the holders to convert to one JM share for SEK 74 during a special conversion window. Employees paid the market price for the convertibles received and the program is not subject to any terms concerning continued employment or performance on the part of employees. They were offered external bank financing for the convertible debentures without any guarantees or undertakings on the part of JM .

Absence due to illness, at JM Sweden

Total absence due to illness amounts to 3.6 percent (4.3) of regular working hours. Of total absence due to illness, 51 percent (50) comprises absence due to illness for more than 60 days.

Absence due to illness, by age, %	2009	2008
–29 year	4.6	4.6
30–49 years	3.1	3.5
50 and older	3.9	5.5
Absence due to illness, by gender, %	2009	2008
Men	3.9	4.7
Women	2.3	2.4

Note 4 DEPRECIATION ACCORDING TO PLAN

	2009	2008
Machinery and equipment	–13	–10
Total	–13	–10

The following depreciation rates are applied:

Construction machinery 10%

Computers and other equipment 20–33 %

NOT e 5	FEES AND REMUNERATION TO AUDITORS
		2009	2008
Ernst & Young
Auditing services		4.5	4.0
Other services		0.7	1.2
Total		5.2	5.2

	2009	2008
Sales values
Project properties	532	550
Development properties	133	198
Total	665	748
Carrying amount
Project properties	–445	–493
Development properties	–131	–182
Total	–576	–675
Results
Project properties	87	57
Development properties	2	16
Total	89	73
Project	Sales value	Results
Special housing for elderly	209	27
conversion into tenant-owners co-operatives	156	16
Other project and development properties	132	2
Rental properties	85	4
Project properties in Norway	55	12
Dissolution of earlier provisions in
conjunction with property sales	28	28
Total	665	89

NOT e 7	Write-downs on properties
		2009	2008
Development properties		–87	–320
Total		–87	–320

Write-downs in 2009 pertain to development properties located in Copenhagen. Write-downs in 2008 pertain to several development properties, mainly located in Copenhagen and Stockholm.

NOTe 8 FINANCIAL INCOME AND EXPENSES

		Financial income
	2009	2008
Dividend	2	1
Interest income	39	87
Total	41	88
	Finance expense
	2009	2008
Interest expense	–132	–91
Interest portion in this year's pension costs	–26	–28
Total	–158	–119

Of the financial income, SEK 27m (3) originate from reassessment and SEK 2m (35) from realized exchange rate gains relating to receivable from international company. SEK 10m (46) of revenues come from cash, cash equivalents, and short-term investments. SEK 96m (46) of the Group's financial expenses pertain to interest-bearing liabilities valued at amortized cost and SEK 7m (37) pertain to reassessment of currency derivatives as well as SEK 20m (0) from realized exchange rate losses pertaining to claims on foreign companies.

2009 2008

NOTe 9 TAXES Net profit/loss before taxes

Sweden	773	1,286
International	–226	–234
Total	547	1,052
Current tax
Sweden	–168	–64
International	7	–18
Total	–161	–82
Deferred tax
Sweden	–22	–227
International	15	75
Total	–7	–152
Total tax
Sweden	–190	–291
International	22	57
Total	–168	–234

Difference between reported tax and nominal tax rate 26.3% (28.0)

Profit before tax 26.3% (28.0)	–144	–295
Adjustment of tax from previous years	–17	7
Difference foreign tax	1	–6
Non-taxable income	13	13
Non-deductible expense	–5	–1
Tax untaxed reserve (tax allocation reserve)	–2	–3
Reassessment of deferred tax attributable to lower
tax on income 2009	-	25
Dissolution deferred tax, previous years	–14	26
Total	–168	–234

NOT e 10	EARNINGS AND DIVIDEND	PER SHARE
		Basic		Diluted
	2009	2008	2009	2008

Earnings per share (SE K) 4.60 9.50 4.60 9.50

Calculation of the numerator and denominator used in the above calculations of earnings per share is shown below. Earnings per share was calculated as net profit for the year attributable to shareholders of the Parent Company divided by weighted average number of outstanding shares during the year.

Earnings per share, basic

Calculation of basic earnings per share for 2009 is based on the profit for the year attributable to shareholders of the Parent Company of SEK 379m (818) and on a weighted average number of outstanding ordinary shares during 2009 amounting to 83,216,883 (85,968,011). Profit for the year is attributable in its entirety to shareholders of the Parent Company.

Number of shares	2009	2008
Total number of outstanding shares, 1 January	83,216,883	88,879,308
Effect of repurchase	-	–87,123
Effect of redemption	-	–2,824,174
Weighted average number of shares during
the year, basic	83,216,883	85,968,011

Earnings per share, diluted

Calculation of diluted earnings per share for 2009 is based on the profit for the year attributable to shareholders of the Parent Company of SEK 388m (818) and on a weighted average number of outstanding ordinary shares during 2009 amounting to 84,376,081 (85,991,380). Profit for the year is attributable in its entirety to shareholders of the Parent Company.

Net profit for the year	2009	2008
Profit for the year attributable to shareholders of
the Parent Company	379	818
Adjustment of interest on convertible debentures
(after tax)	9	-
Profit for the year attributable to shareholders
of the Parent Company, diluted	388	818
Number of shares	2009	2008
Weighted average number of shares during the year,
basic	83,216,883	85,968,011
Effect of issued long-term variable salary programs	1,159,198	23,369
Weighted average of the number of shares
during the year, diluted.	84,376,081	85,991,380

Outstanding number of shares and instruments with potential dilutive effects

At the end of 2008 JM had 83,216,883 outstanding shares. The number of outstanding shares remained unchanged in 2009. JM holds a total of 185,000 repurchased shares as a hedge for its long-term variable salary programs.

Instruments that may have a potentially dilutive effect include JM 's two share match programs (2007 and 2008), JM 's 2008 performance share program, JM 's three convertible programs (2007, 2008 and 2009) and JM 's two warrant programs (2008 and 2009).

When calculating earnings per share, JM 's convertible program entails a dilution of the number of shares. JM 's warrant program has entailed dilution of earnings per share, since the strike price in one of the programs exceeds the average share price. However, the effect is extremely limited in scope. The strike price is SEK 134 for the 2008 warrant program and SEK 74 for the 2009 warrant program.

JM 's 2008 performance share program has not entailed any dilution of the number of shares, as the conditions in this program were not met during the year.

No changes relating to the number of outstanding shares has occurred after the end of the reporting period.

For more information about JM 's long-term variable salary programs, see note 1, Accounting and valuation principles and note 3, Employees and payroll expenses.

Cash dividend (as proposed by the Board of

Directors for 2009)	2009	2008
– per share (SEK)	2.50	0
– total (SEKm)	208	0

e 11 GOODWILL	NOT
------------------	-----

	2009	2008
Opening cost
Opening balance, January 1	56	60
Translation differences	6	–4
Closing balance, December 31	62	56

The reported goodwill mainly pertains to goodwill at the acquisition of Byggholt AS in 1998 and AS Prosjektfinans in 1999, which constitute JM 's total operation in Norway.

As of January 1, 2005, JM began to apply IFRS 3, Business Combinations, which means, among other things, that goodwill is no longer amortized but will be tested for impairment according to IAS 36 at least annually, or more often if there is any indication of impairment. Defined goodwill for the acquisitions of 1998 and 1999, respectively, totaled about NO K 100m.

AS Projektfinans merged with Byggholt AS 2003 and operations are considered fully integrated in Byggholt and the Byggholt Group is therefore the lowest cash-generating unit. The carrying amount for the Byggholt Group was tested for impairment as of December 31, 2009 and the recoverable value was found to exceed the carrying amount. Therefore no impairment loss for goodwill was necessary.

Recoverable value was defined by calculating the value in use of the cash-generating unit. Value in use for goodwill attributable to the Byggholt Group was calculated based on discounted cash flows. Cash flow for the first two years, after 2009, is based on the strategic plan adopted by the management.

Cash flow beyond the strategic two-year period is extrapolated based on the following assumptions:

• Estimated profit or loss before tax, based on the previous year's results and expectations of future market developments.
• Growth rate of at least 2 percent in order to extrapolate cash flow beyond the strategic period. The growth rate is a conservative assumption of the operation's long-term growth, not exceeding growth for the industry as a whole.
• Discount rate before tax is 11 percent, which is based on the JM Group's average cost of capital before tax, while taking operation-specific data into account.

Sensitivity analysis

If the estimated earnings before tax after the end of the strategy period had been 5 percent lower than the management's assessment, the recoverable amount would decrease by 5 percent.

If the estimated growth rate used to extrapolate cash flows beyond the strategy period had been 50 percent lower than the basic assumption, the recoverable amount would decrease by 10 percent.

If the estimated average cost of capital applied for the discounted cash flow had been 3 percentage points greater than the basic assumption, the recoverable would decrease by 25 percent.

A sensitivity analysis of the discount rate shows that the discount rate would have to exceed 15 percent before the need for impairment would be present.

In all cases the sensitivity analysis above shows that a surplus (i.e., the recoverable amount is higher than the carrying amount). None of the hypothetical cases above should lead to an impairment of goodwill for the Norwegian business.

NOTe 12 PROPERTY, PLANT , AND EQUIPMENT

	Machinery and equipment			Other property, plant, and equipment		Total
	2009	2008	2009	2008	2009	2008
Opening cost
Opening balance, January 1	118	140	-	16	118	156
New purchases	9	13	-	-	9	13
Translation differences	2	0	-	0	2	0
Sales	–13	–35	-	–16	–13	–51
Closing balance, December 31	116	118	-	-	116	118
Accumulated depreciation according to plan
Opening balance, January 1	–97	–114	-	–16	–97	–130
Depreciation for the year	–13	–10	-	-	–13	–10
Translation differences	–1	–1	-	0	–1	–1
Sales	13	28	-	16	13	44
Closing balance, December 31	–98	–97	-	-	–98	–97
Closing residual value according to plan	18	21	-	-	18	21

NOTe 13 PARTICIPATIONS IN ASSOCIATES

	2009	2008
Opening cost
Opening balance, January 1	6	6
New purchases	6	0
Sales	0	0
Closing balance, December 31	12	6

NOTe 14 PARTICIPATIONS IN ASSOCIATES

Specification of Parent Company's shares and participation in associates, SEK 000s

Registration			Number of shares	% of		Carrying amount
Company	number	Domicile	and participations	capital	2009	2008
AB Hälsingborgsbostäder	556105-9196	Helsingborg	500	50	50	50
AB Ramlösa Brunnsanläggning	556031-6274	Helsingborg	625	50	75	75
Adolfsbergs Brunns AB	556303-8685	Örebro	340	33	34	34
Dockan Exploatering AB 2)	556594-2645	Malmö	333	33	5,003	5,003
Exploateringsbolaget Högmora KB	916643-6258	Stockholm	1	25	11	1
Fastighetsbolaget Glasberga KB	916643-1842	Stockholm	1	25	101	101
Glasberga Fastighets AB	556361-0707	Södertälje	1,000	25	100	100
HB Silverdal Exploatering 1)	969674-5802	Sollentuna			1	1
Högmora Exploaterings AB	556395-0707	Stockholm	1,000	25	100	100
Kvarnholmen Utveckling AB 2)	556710-5514	Stockholm	50,000	50	105,886	80,886
Kvibergstaden Exploatering HB	969731-1695	Göteborg	1	50	2,000	2,000
Mälarstrandens Utvecklings AB 2)	556695-5414	Västerås	44	44	2,200	11,893
SMÅA AB	556497-1322	Stockholm	3,500	33	8,950	3,500
Carrying amount, December 31					124,511	103,744

¹ ) Unlimited liability

2) Joint ventures

Specification of the Group's other holdings of shares and participations in associates, SEK 000s

		Number of shares	% of		Carrying amount
Company	Domicile	and participations	capital	2009	2008
Grefsen Utvikling AS, Norway	Bærum	500	50	–5,835	–4,590
Investbygg AS, Norway	Bergen	500	50	–441	–277
Kjørbokollen Utbygging AS, Norway	Bærum	10,000	50	2,138	13,422
Landmannstorget, Norway	Asker	100	50	38	41
Larvik Saneringsselskap AS, Norway	Larvik	100	50	2,052	1,797
Merbraine, Belgium	Bryssel	313	25	155	-
Son Utvickling AS, Norway	Oslo	550	50	11,798	10,746
Tennisveien AS, Norway	Oslo	200	20	251	223
Carrying amount, December 31				10,156	21,362
Reclassification in the Group primarily due to the proportional method				–122,931	–118,829
Carrying amount in the Group, December 31				11,736	6,277

Note 14 cont'd.

Participations in joint ventures are consolidated according to the proportional method

The Group's financial reports include the following items that comprise the Group's holdings in the joint venture company's revenues, expenses, assets and liabilities.

	2009	2008
Revenues	110	107
Expenses	–92	–100
Result	18	7
Assets	526	430
Liabilities	–248	–116
Net assets	278	314

NOTe 15 FINANCIAL ASSETS

	2009	2008
Opening cost
Opening balance, January 1	21	23
Additional receivables	45	0
Settled receivables	–6	–1
Reclassification	10	-
Translation differences	1	–1
Closing balance, December 31	71	21

NOTe 16 PARTICIPATIONS IN GROUP COMPANIES

Specification of Parent Company's shares and participation in wholly owned Group companies, SEK 000s

	Registration		Number of shares		Carrying amount
Company	number	Domicile	and participations	2009	2008
AB Borätt	556257-9275	Stockholm	500	1,978	1,978
AB Garantihus	556073-0524	Stockholm	5,000	1,000	1,000
AB Naryda	556046-9081	Stockholm	1,000	13,000	13,000
Bruket i Kallhäll Exploaterings AB	556561-0184	Stockholm	1,000	100	100
Bruket i Kallhäll Exploaterings KB	969653-9122	Stockholm		10	10
Decemberviken AB	556668-2463	Stockholm	1,000	93	93
Fastighets AB Spången	556708-2093	Stockholm	100,000	100	100
Fastighetsbolaget Bohusmark KB	916443-1125	Göteborg	1	1,120	1,120
Fastighetsbolaget Kung Oscars Bro AB	556692-4493	Lund	100	10,475	-
Fastighetsbolaget Raffinadgatan AB	556682-8835	Lund	1,000	10,631	-
Förvaltningsbolaget Gnarpen AB	556717-3793	Stockholm	100	100	-
JM Byggholt AS, Norway	829350122	Oslo	20,000	127,687	127,687
JM Byrån Holding	556752-9630	Stockholm	1,000	100	100
JM Construction SA, Belgium	413662141	Brussels	10,000	111,906	111,906
JM Danmark AS	21410233	Copenhagen	100,000	227,701	351,277
JM Entreprenad AB	556060-8837	Stockholm	200,000	107,750	107,750
JM Hjulkuggen 1 and 4 AB	556720-7195	Malmö	1,000	448	448
JM Hjulkuggen 3 AB	556702-4871	Lund	1,000	521	521
JM Inredning i Stockholm AB	556202-8653	Stockholm	1,000	50	50
JM Jönköping Hagstensgärdet 1:5 AB	556658-7506	Jönköping	1,000	311	311
JM Måsen 16 AB	556627-7827	Malmö	1,000	100	100
JM Stombyggnad AB	556173-0564	Stockholm	1,000	113	113
JM Strandhusen AB	556738-3939	Stockholm	1,000	108	108
JM Suomi OY	1974161-8	Helsinki	1,000	113,201	81,839
JM Värmdöstrand Holding AB	556275-4696	Stockholm	3,300,120	292,442	292,442
JM Älta Centrum	556638-5380	Stockholm	1,000	564	1,449
JM Älta Holding AB	556638-5372	Stockholm	1,000	40,100	40,100
KB Silverfjädern	969676-7525	Stockholm		0	0
Kvarnexet 1 AB	556782-4163	Stockholm	1,000	41,148	-
Kvarnexet 5 AB	556795-0547	Stockholm	1,000	37,609	-
Lekandria Fastighets AB	556701-9046	Stockholm	1,000	100	100
Milud AB	556395-8643	Västerås	1,000	100	100
Projektmäklarna AB	556680-1873	Stockholm	1,000	100	-
Seniorgården AB	556359-9082	Stockholm	1,000	100	100
Södra 1 and 2 i Lund AB	556720-6148	Lund	1,000	113	113
TG Betongarbeten Produktion AB	556476-7720	Trollhättan	1,000	3,860	7,433
Carrying amount, December 31				1,144,839	1,141,448

Note 16 cont'd.

Specification of the Group's other holdings of shares and participations in wholly owned group companies, SEK 000s

	Registration		Number of shares		Carrying amount
Company	number	Domicile	and participations	2009	2008
AB Christeliten	556720-1180	Stockholm	1,000	100	100
AB Stockholms Badmintonhall	556037-3655	Stockholm	2,520	391	391
Brf Mården	716300-0499	Stockholm	3,800,000	0	0
Byggholt AS, Norway		Bærum	100	133	117
Dinant-Meuse, Belgium		Brussels	6,200	632	678
Esplanade 64, Belgium		Brussels	3,000	1,553	3,281
Fastighet 1 DPL 3 AB	556716-5047	Stockholm	1,000	6,030	5,940
Fastighet 2 DPL 3 AB	556716-5062	Stockholm	1,000	6,901	6,861
Fastighet 3 DPL 3 AB	556716-5070	Stockholm	1,000	7,468	7,388
Fastighet 4 DPL 3 AB	556716-5245	Stockholm	1,000	7,185	7,125
Fastighet 5 DPL 3 AB	556716-6581	Stockholm	1,000	2,284	2,224
Fastighet 6 DPL 3 AB	556716-6615	Stockholm	1,000	2,128	2,078
Fastighet 7 DPL 3 AB	556716-6623	Stockholm	1,000	15,553	15,503
Fastighets AB Litografin	556768-1514	Stockholm	-	-	100
Fastighets AB Skissen	556768-3320	Stockholm	-	-	100
Fastighets AB Vingen	556768-1472	Stockholm	-	-	100
Frydenbergstomter AS		Tønsberg	-	-	756
Markan hyresbostäder AB (formerly Frösunda Hus IV AB)	556694-1786	Stockholm	-	-	100
Förvaltnings AB Gnarpen	556717-3793	Stockholm	-	-	100
Förvaltnings AB Valdor	556742-1283	Stockholm	1,000	1,030	1,030
Förvaltnings AB Vilgur	556220-7984	Stockholm	1,000	24,664	24,664
Förvaltnings AB Vistet	556121-1979	Stockholm	1,000	17,743	17,743
Grafiken i Stockholm AB	556149-6034	Stockholm	3,000	300	1,304
Haugsnesfjero Næring AS, Norway		Bergen	-	-	279
JM Byggholt Proff, Norway		Bærum	50	613	4,653
JM Förskolelokaler AB	556728-9235	Stockholm	-	-	100
JM Vaxholm AB	556390-9174	Stockholm	13,300	1,333	1,333
JM Värmdöstrand AB	556001-6213	Värmdö	4,400	158,000	158,000
Lervig Maritim Utbyggingsselskap AS, Norway		Stavanger	10,000	975	864
Lidingöstrand Fastighets AB	556740-2648	Stockholm	1,000	100	100
Mariastaden AB	556228-8596	Stockholm	100	2,000	2,187
Merbraine, Belgium		Brussels	-	-	170
Månstrålen Holding AB	556072-9492	Stockholm	5,000	739,759	739,759
Nærsnesutbyggingen AS, Norway		Bærum	90,000	20,695	18,372
Naturtomter AS, Norway		Tønsberg	15	–1,074	–808
Nor-Invest AS, Norway		Tønsberg	514,396	25,193	36,160
Peter Wessels AS, Norway		Tønsberg	860	0	0
Sophies Minde Utvikling AS, Norway		Oslo	300	7,896	5,711
Stavanger Naeringsselskap AS, Norway		Stavanger	83,451,000	27,409	31,439
Søilandsgaten Sjøfront AS, Norway		Stavanger	1	2,378	2,104
Tellaplan Fastighets AB	556733-6010	Stockholm	1,000	100	100
Trulsrudmarka AS, Norway		Bærum	1,000	1,848	9,365
Waldemars Hage Næring AS, Norway		Bærum	-	-	110
Årstapaviljongen AB	556069-3425	Stockholm	1,000	142	142
Äldreboendet Lillängen AB	556743-6174	Stockholm	-	-	100
Äldreboendet Solbacka AB	556768-3924	Stockholm	1,000	100	100
Äldreboendet Ymerplan AB	556742-7199	Stockholm	-	-	100

NOTe 17 PROJECT PROPERTIES AND DEVELOPMENT PROPERTIES

	Project properties 1)		Development properties
	2009	2008	2009	2008
Opening cost
Opening balance, January 1	614	790	6,046	5,375
New purchases	443	314	280	860
Company acquisitions	10	-	148	711
Reclassifications	–33	7	20	–7
Translation differences	7	–4	38	77
Transferred to production	-	-	–910	–781
Sales	–445	–493	–131	–189
Closing balance, December 31	596	614	5,491	6,046
Accumulated write-downs
Opening balance, January 1	-	-	–426	–93
Translation difference	-	-	12	–20
Write-downs for the year	-	-	–87	–320
Sales	-	-	-	7
Closing balance, December 31	-	-	–501	–426
Closing residual value according to
plan	596	614	4,990	5,620
Tax assessment values	296	136	2,836	2,878

1) Interest expenses added to the cost of project properties amounted to SEK 8m (5).

Reported residual value for the part of development properties recognized at net realizable value amounts to SEK 1,601m (1,683).

NOTe 18 PARTICIPATIONS IN TENANT -OWNERS associations, ETC .

	2009	2008
Opening cost
Opening balance, January 1	171	104
New purchases	1,519	316
Translation difference	–1	–1
Sales	–1,336	–248
Closing balance, December 31	353	171

NOTe 19 OTHER CURRENT RECEIVABLES

	2009	2008
Receivables from property sales	3	474
Income taxes recoverable	8	139
Other	336	261
Total	347	874

NOTe 20 RECOGNIZED REVENUE LESS PROGRESS BILLINGS

	2009	2008
Recognized revenue in work in progress	5,597	7,360
Accumulated billing on account for work in progress	–4,629	–6,401
Total	968	959

NOTe 21 CASH AND CASH EQUIVALENTS

	2009	2008
Cash and bank balances	830	1,111
Short-term investments	1,200	0
Total	2,030	1,111

Short-term investments have a maturity ranging from 1 day up to 3 months.

NOTe 22 INTEREST-BEARING LIABILITIES Long-term interest-bearing liabilities 2009 2008 Liabilities to credit institutions maturity date 1–5 years from closing day 83 95 Long-term promissory note, development properties 1–5 years 15 20 Convertible loan 1–5 years 220 192 Liabilities to credit institutions, maturity > 5 years from closing day 8 7 Total 326 314 Current interest-bearing liabilities 2009 2008 Liabilities to credit institutions, interest-bearing –1 year 232 397 Short-term promissory note, development properties 719 740 Total 951 1,137

Interest-bearing
net liabilities/receivables		2009 Change		2008 Change	2007
Current interest-bearing liabilities Long-term interest-bearing liabili	951	–186	1,137	1,092	45
ties	326	12	314	98	216
Transferred to pensions	565	52	513	14	499
Minus: cash and cash equivalents	–2,030	–919	–1,111	950	–2,061
Minus: interest-bearing receivables	–1	10	–11	1	–12
Interest-bearing net liabilities
(+)/receivables (–) at year-end	–189	–1,031	842	2,155	–1,313

NOTe 23 FINANCIAL RIS ^K MANAGEMENT AND FINANCIAL DERIVATIVE INSTRUMENTS

The JM Group is exposed to different types of financial risks which may influence profit, cash flow and equity. These risks mainly comprise:

• Interest risk for borrowing and cash and cash equivalents

• Financing- and liquidity risks pertaining to the Group's capital requirements
• Currency risk pertaining to profit and net investments in foreign subsidiaries
• Credit risk attributable to financial and commercial activities.

JM's Board of Directors has adopted a policy for how to handle and control these risks within the Group. Financial risk management is largely concentrated to Finance and Treasury, which is also mandated to support operational activities. At the same time, the International companies are responsible for local activities in accordance with financial policy guidelines. The financial policy also includes interest risk management rules for construction loans during ongoing production, as well as final financing of tenant-owners' associations.

The accounting principles are described in note 1. The Risk and risk management section on pages 38–41 describes the Group's risk management and financial policy.

Interest rate risk

Interest risk refers to the risk that changes in interest rates would have a negative effect on the Group's net interest and cash flow. One of the main risk factors involves choosing the term for fixed rate loans for the Group's loan portfolio. JM chooses its fixed rate terms based on the tied up capital and cash flows of ongoing projects, the volume of long-term borrowing, as well as the current market situation for interest rates with different maturities. To achieve the desired term for fixed-rate loans, the Group primarily works with interest rate derivatives, mainly interest rate swaps.

Since the volume of long-term borrowing is relatively limited the Group mainly works with short time to maturity. The average term for fixed-rate loans excluding pension liability on December 31, 2009, was 0.3 years (1.0).

Fair value on interest-bearing loans was SEK 1,277m (1,451). The fair value of interest-bearing liabilities to credit institutions is assumed to correspond to the carrying amount since they mainly have a short fixed-term of less than three months. The JM Group has no outstanding interest rate derivatives as of December 31, 2009.

Interest risk exposure, including derivatives
-----------------------------------------------	--

		2009	2008
Year for interest conversion	Loan amount (SE Km)	Average interest (%)	Loan amount (SE Km)	Average interest (%)
2009	-	-	732	5.4
2010	1,277	4.0	719	5.0
Pension liability 1)	565	4.0	513	4.0
Total	1,842	4.0	1,964	4.9

1) Pension interest adjusted annually.

Note 23 cont'd.

The average interest rate on interest-bearing liabilities as of December 31, 2009 excluding pension liabilities was 4.0 percent (5.2). A 1 percent change in the market interest rate corresponds with an effect on earnings of about SEK 9m for the part of the loan portfolio traded during 2010. The calculation is an approximation and is based on the assumption of a simultaneous change in all interest rate curves.

Cash and cash equivalents

Cash and cash equivalents consist of cash and short-term investments. According to JM's financial policy, the company may only invest excess liquidity in liquid instruments issued by issuers with a credit rating of at least A- according to Standard & Poor's or similar credit rating agency. The investments are short-term with a term of between one day and three months. See note 21 for breakdown between cash and short-term investments.

Liquidity and financing risk

Financing and liquidity risk Financing and liquidity risk refers to the risk that loans could become more difficult and more expensive to refinance and that the Group cannot fulfill its current payment obligations due to inadequate liquidity. The Group manages its financing risk by signing long-term binding credit agreements with different maturities with several different institutions. According to the policy, the average term of framework agreements should be two to three years.

Binding loan commitments		Check
Maturity	Total	credit	2010	2011	2012
Loan commitments (SEKm)	2,800	400	700	500	1,200

The Group has unutilized approved credit lines of SEK 2,800m.

The Group maintains cash and cash equivalents, together with approved credit lines, of at least 10 percent of JM 's revenues in order for the Group to handle investments and current payments.

Foreign exchange risk

During the year the Group extended loans to subsidiaries abroad. The exposure is hedged in its entirety. Because of extremely limited transaction volumes in foreign currency the Group has not engaged in hedging activities for these volumes.

Credit risk

Credit risk associated with financial services

Credit risk exposure in the form of counterparty risk arises with investment of cash and cash equivalents and during derivative trading. In order to limit credit risks the Group has prepared a counterparty list that sets a maximum exposure in relation to each approved party. ISDA agreements (International Swaps and Derivative Association) or equivalent Swedish bank agreements have been prepared with those counterparties that are used for transactions with derivative instruments.

Credit risk associated with accounts receivable

The JM Group's customers are mainly tenant-owners associations and future owners of private homes. The Group also engages in project development of commercial premises and contracting services. The Group also has tenants in both residential and commercial premises.

Credit risk exposure relating to tenant-owners associations is deemed to be limited since financing of production takes place through the association's bank loan, purchased by JM . A similar arrangement applies for customers who buy their own homes. To ensure the customer's ability to pay a credit check is always carried out. Uncertainty relating to projects is managed by applying the rules for profit recognition, see note 1 Accounting principles. Accounts receivable for housing production amounts to SEK 225m (273).

Credit risk exposure in relation to commercial customers, contracting and for rentals of residential and commercial premises has a somewhat different nature. Accounts receivable for these groups amounts to SEK 160m (234).

The provision for doubtful receivables amounts to SEK 5.6m (6.0). During the year the Group used SEK 1.0m (1.0) of earlier provisions. Accounts receivable older than 60 days amounts to SEK 57m (40). Provision and utilization of the provision for doubtful receivables were recognized in the income statement.

Aged accounts receivable

Dec 31, 2009	Nomi	Not	<30	30–60	61–90	>90
SE Km	nal	due	days	days	days	days
Residential	225	86	71	17	3	48
Contracting	165	151	7	1	0	6
Other	– 5	– 5	-	-	-	-
Total	385	232	78	18	3	54
Number of invoices	861	528	144	34	26	129
Dec 31, 2008	Nomi	Not	<30	30–60	61–90	>90
mkr	nal	due	days	days	days	days
Residential	273	154	52	28	0	39
Contracting	240	216	19	4	0	1
Other	–6	– 6	0	0	0	0
Total	507	364	71	32	0	40
Number of invoices	1,095	791	125	34	0	145

j m a n n u a l r e p o r t 2 0 0 9

Credit risk analysis customers

Dec 31, 2009 Interval	Number of customers	In % of number	In % of portfolio
Exposure interval < SEK 1m	557	90	18
Exposure interval SEK 1–5m	40	7	35
Exposure interval > SEK 5m	19	3	47
Total	616	100	100
Dec 31, 2008	Number of	In % of	In % of
Interval	customers	number	portfolio
Exposure interval < SEK 1m	717	92	16
Exposure interval SEK 1–5m	45	6	23
Exposure interval > SEK 5m	16	2	61
Total	778	100	100

Valuation of financial assets and liabilities

JM used generally accepted methods for calculating the fair value of the Group's financial instruments as of December 31, 2009 and 2008. The fair value of interest-bearing liabilities to credit institutions is assumed to correspond to the carrying amount since they mainly have a short fixed term of less than three months. Notes payable for property acquisitions become payable in conjunction with fulfillment of various conditions, such as approval of local plans or when the project begins. The fair value of notes payable for property acquisitions is therefore assumed to be equal to the carrying amount when the liabilities are payable on demand. For all other financial assets and liabilities, such as cash and cash equivalents, accounts receivable, and accounts payable, the carrying amount is assumed to provide a good approximation of fair value/cost. The Group applies trade date accounting.

The following table shows fair value, carrying amount and information about the category to which the JM Group's financial instruments belong in accordance with IAS 39 Financial instruments: Recognition and measurement.

	Category Dec 31, 2009 Dec 31, 2008 according
Fair value financial	to	Carrying	Fair	Carrying	Fair
instruments	IAS 391)	amount	value	amount	value
Assets
Interest-bearing financial
assets	L&R	1	1	11	9
Other financial assets	L&R	70	65	10	10
Other long-term receivables L&R		70	65	9	9
Other long-term securities	AFS	0	0	1	1
Accounts receivable	L&R	385	385	507	507
Other current receivables	L&R / n/a	347	347	874	874
Derivative instruments 2)	FAvPL	0	0	-	-
Receivables from property
sales	L&R	3	3	474	474
Other	n/a	344	344	400	400
Cash, cash equivalents, and
short-term investments	L&R	2,030	2,030	1,111	1,111
Cash and cash equivalents	L&R	830	830	1,111	1,111
Short-term investments	L&R	1,200	1,200	0	0
Liabilities
Long-term interest-bearing
liabilities	FLA C	326	326	314	314
Convertible loan	FLAC	220	220	192	192
Other non-current interest
bearing liabilities borrowing FLAC		106	106	122	122
Other non-current liabilities FLA C		113	113	271	271
Accounts payable	FLA C	365	365	497	497
Current interest-bearing
liabilities	FLA C	951	951	1,137	1,137
Other current liabilities	FLA C	471	471	414	414
Derivative instruments	FLrIS	3	3	14	14
Other current liabilities	FLAC	468	468	400	400

1) Classification in accordance with IAS 39, explanation to abbreviations:

AFS Available-for-sale financial assets

L&R L oans and receivables

FAvPL Financial assets at fair value through profit or loss

FLA C Financial liabilities measured at amortized cost

FLrIS Financial liabilities are recognized at fair value in the income statement n/a IAS 39 does not apply

2)   Measurement of fair value for all assets and liabilities at fair value is based on directly or indirectly observable prices, corresponding with level 2 in accordance with IFRS 7.

Note 23 cont'd.

Financial derivative instruments

JM uses financial derivative instruments to manage interest risks and on a selective basis, occasional currency risks. Derivative instruments may only be used to minimize risks. All gains and losses that arise in market valuations of instruments are recognized directly in profit and loss, since the JM Group does not apply hedge accounting for existing derivatives.

JM Group has no outstanding interest rate derivatives as of December 31, 2009. Currency derivatives for Group loan to international company remeasured at fair value to SEK –3m (–14).

Asset Management

JM manages capital, which comprises the consolidated equity, with the purpose of providing JM shareholders with a higher total return than shareholders in companies with similar operations and risk profile.

JM 's ambition is to maintain an optimal composition of assets and capital structure over time, suitable for the company's project development activities. According to the stated objectives for capital structure, the equity ratio should be at least 35 percent. The equity ratio target is a simplified consequence of a more extensive analysis where shareholders' equity has been allocated to the different asset classes and types of operations in the balance sheet, taking assessed operating risk into account. The relevant key indicators can be seen in the five-year overview on page 75.

Also see the sections "Business concept, goals and strategies" and "The JM Share".

NOTe 24 PROVISIONS FOR PENSIONS AND SIMILAR COMMITMENTS

Defined-benefit plans

JM has defined-benefit plans for pensions in Sweden and Norway. The most significant defined-benefit plan is in Sweden and refers to the ITP plan. During the year JM chose to reclassify the alternative ITP plan offered by the company to a defined-contribution plan.

Defined-contribution plans

These plans mainly comprise retirement pension and family pension.

Premiums are paid regularly during the year by the Group company concerned to separate legal entities, such as insurance companies. The pension cost for the period is recognized in the income statement.

Obligations regarding employee benefits, defined benefit plans The following provisions for pension obligations have been made in the balance sheet:

Group	2009	2008
Pension obligations, funded plans	20	345
Managed assets' fair value	–11	–261
Net sum, funded plans	9	84
Pension obligations, unfunded plans	688	655
Unrecognized actuarial gains (+), losses (–), pension commitments	–132	–230
Unrecognized actuarial gains (+), losses (–), plan
assets	0	4
Net liability according to balance sheet	565	513

Pension commitments, plan assets and provisions for pension obligations as well as actuarial gains/losses for the defined benefit pension plans have developed as follows:

Total pension commitments	2009	2008
Opening balance, January 1	1,000	843
Benefits earned during the year	23	44
Interest expense	26	38
Benefits paid	–20	–15
Reclassification	–328	–7
Unrecognized actuarial gains (–), losses (+)	5	98
Translation differences	2	–1
Closing balance, December 31	708	1,000
Plan assets, fair value	2009	2008
Opening balance, January 1	261	215
Anticipated return on plan assets	0	10
Funds added to the plan	0	48
Reclassification	–251	–7
Unrecognized actuarial gains (+), losses (-)	0	–4
Translation differences	1	–1
Closing balance, December 31	11	261

Reconciliation pension provisions			2009		2008
Opening balance, January 1 513					499
Pension costs, defined benefit plans			54		76
Benefits paid			–20		–15
Funds added to the plan				0	–48
Reclassification				17	-
Translation differences				1	1
Closing balance, December 31			565		513
Actuarial gains (+), losses (–)	2009	2008	2007	2006	2005
Total pension commitments	708	1,000	843	809	793
Plan assets, fair value	11	261	215	152	136
Experience adjustments, percentage
of this year's unrecognized actuarial gains (+) and loss (–)
Pension obligations (SEK m)	–10	–10	3	7	–24
Percent of total value of pension
commitments	–1.4	–1.0	0.4	0.9	–3.1
Plan assets (SEK m)	–0.4	–3.0	17.0	–6.0	–0.8
Percent of total value of managed assets	–3.3	–1.1	7.9	–4.0	–0.6
Pension expenses			2009		2008
Benefits earned during the year			23		44
Interest on obligations			26		38
Anticipated return on plan assets				0	–10
Amortization actuarial loss				5	4
Pension costs, defined benefit plans			54		76
Pension costs, defined contribution plans			112		74
Social security expenses, defined benefit and defined
contribution plans				31	26
Total			197		176

Of the above pension costs, SEK 26m (28) is recognized as a financial cost, corresponding with the net of interest on obligations and anticipated return on plan assets.

JM uses the "corridor" approach to recognize actuarial gains and losses are gradually amortized onto the income statement and balance sheet. Actuarial gains and losses arise when the outcome deviates from underlying assumptions. Since JM 's total actuarial loss as of December 31, 2009, is greater than 10 percent of the actual pension obligation, JM must expense a small part of the actuarial loss in 2010. For JM this means an increased pension cost in 2010 of SEK 7m, including social security expenses, relating to this part.

JM 's expects cash flow for the pension provision in 2010 to be SEK –22m.

Actuarial assumptions

The most important actuarial assumptions as per closing day for each geographic market can be seen in the following table.

	Sweden
%	2009	2008
Discount rate	4.00	4.00
Plan assets	-	4.00
Expected salary increases	3.50	3.50
Inflation	2.00	2.00
Income base amount	3.00	2.75

The discount rate is determined for each geographic market taking the market return on corporate bonds on the closing date into account. In Sweden and Norway, where there is no functioning market for such bonds, the market return on government bonds is used and a premium for a longer maturity added based on the duration of the pension obligations.

The anticipated salary increase factor corresponds to anticipated future salary increases as a composite effect of inflation, period of service, and promotion.

The inflation factor corresponds in most pension plans to the anticipated pension upward adjustment (or indexing). In this component JM has chosen to use the inflation targets set up by the national central banks.

JM Sweden uses mortality table FFFS 2007:31 to determine mortality assumptions. FFFS 2007:31 specifies various mortality assumptions depending on year of birth. The more recently an employee was born, the longer the remaining life expectancy after retirement. In practical terms, this means that when calculating its pension liability, JM assumes that a man in Sweden who is 65 years old today will live for 21 years after retirement and a woman for 24 years, while a man born in 1980 who turns 65 will live for 24 years after retirement and a woman for 25 years.

NOTe 25 OTHER PROVISIONS

		Product warranty provisions
	2009	2008
Opening balance, January 1	278	258
Utilized/Dissolution	–95	–156
Provisions	135	176
Closing balance, December 1)	318	278
1) Of which short-term part of provisions for	133	112

Provisions for guarantees relate to costs that could arise during the guarantee period and are reported as non-current and current liabilities in the balance sheet.

The amount of the provision is primarily based on the number of residential units per project and is charged to the project upon conclusion. The longest term for product warranty provisions is ten years, while the majority of product warranty provisions are for two to three years.

Since the effect of when in time payment occurs is immaterial, expected future payments are not calculated at present value.

NOTe 26 DEFERRED TA ^X ASSETS AND LIABILITIES

	2009	2008
Deferred tax liability on untaxed reserves 1)	157	110
Other deferred tax liability*	896	896
Sub-total	1,053	1,006
Less deferred tax assets 2)	–110	–106
Net provisions for tax	943	900
Deferred tax receivable	95	80
*Other deferred tax liability allocated to
Project properties 3)	-	8
Development properties 3)	277	295
Provision for taxation for write-down (not yet
approved)/loss carry-forward 4)	532	525
Other current assets	87	68
Total	896	896

1) Tax rules in Sweden allow companies to postpone taxation through provisions to untaxed reserves in the balance sheet via appropriations in the income statement. However, untaxed reserves or appropriations are not stated in the consolidated financial statements. Untaxed reserves are divided between deferred tax liability and restricted reserves respectively in shareholders' equity.

2) Mainly pertains to current liabilities.

3) Fiscal difference and carrying amount.

4) The appealed Swedish Tax Agency decision of Dec. 15, 2008 relating to final tax for 2006 has not yet been settled by the County Administrative Court. The financial statements include a tax asset of SEK 44m while awaiting the County Administrative Court decision.

NOT e 27	PROGRESS BILLINGS IN EXCESS OF RECOGNI ZED REVENUE
		2009	2008
	Accumulated billing on account for work in progress	16,689	17,531
	Recognized revenue in work in progress	–15,374	–15,948
Total		1,315	1,583

NOTe 28 ACCRUALS AND DEFERRED INCOME

	2009	2008
Personnel-related items	393	518
Prepaid rental income	17	21
Other accruals	408	351
Total	818	890

NOTe 29 PLEDGED ASSETS AND CONTINGENT LIABILITIES

	2009	2008
Assets pledged to secure own provisions and liabilities
Corporate mortgages	100	100
Property mortgages	95	112
Total 1)	195	212
Contingent liabilities
Guarantee commitments, other 2)	3,320	5,039
Guarantees in connection with assignments	508	426
Payment and rental guarantees	43	13
Other contingent liabilities	12	12
Total	3,883	5,490

1) The corporate mortgage relates to the pension liability that JM Sweden has with PRI. Property mortgages are only granted to a limited extent for financing with credit institutions.

2) During the production period of a tenant-owners association, the JM Group provides guarantees for part of the short-term financing that exceeds a cooperative's future long-term loans. Guarantee commitments, other relate entirely to this short-term financing.  The long-term loans are secured by the mortgage deeds taken out by the association.  The reduction in guarantee commitments is due to the reduction of volume that occurred in the operation.

The Group also has obligations to acquire unsold participations in tenant-owners associations formed by JM .

A tenant-owners association's only revenue is its monthly charges. JM provides a seven year guarantee to ensure that the association receives the estimated monthly charges. This guarantee comprises an undertaking to buy such apartments as are returned to the association from the first owner. JM then buys the apartment for SEK 1 and then pays the monthly charge to the association until JM in its turn has sold the apartment. This guarantee has existed since 1993 and has never been utilized. JM considers it unlikely that the guarantee will need to be met in other than exceptional cases.

AB Bostadsgaranti has a recourse agreement against JM AB regarding their investment guarantee for paid contributions and charges for grant of enjoyment. The guarantee primarily ensures that the association can repay a reasonable amount (maximum contribution and charges) to the tenant-owner who has a right of termination due to significant increases in charges during the first year after final accounts, after which AB Bostadsgaranti has no liability to pay anything. AB Bostadsgaranti has not paid out anything since 1962.

NOTe 30 RELATED PARTY DISCLOSURES

Related party disclosures can be seen in notes 3 and 16. The Group's transactions with associated companies, over and above what is specified in note 3 Employees and personnel costs, only addresses associated companies and joint ventures, are limited in scope and have occurred at market rates.

income statement and cash flow statement—parent company 69

INCOME STATEMENT — PARENT COMPANY , SE Km	Note	2009	2008
	1
Net sales		5,990	8,702
Production and operating costs	2, 3	–4,936	–6,983
Gross profit		1,054	1,719
Selling and administrative expenses	2, 3, 4	–413	–512
Gains on the sale of properties	5	2	36
Write-downs on properties	6	-	–75
Operating profit		643	1,168
Result from financial items	7
Result from Group companies		–134	374
Result from associated companies		2	1
Result from other financial assets		5	5
Result from financial current assets		53	108
Interest expenses and similar income statement items		–114	–96
Profit before appropriations and tax		455	1,560
Appropriations	8	–180	–72
Profit before tax		275	1,488
Taxes	9	–134	–60
Net profit for the year		141	1,428

CASH FLOW STATEMENT — PARENT COMPANY , SE Km Note	2009	2008
1
OPERATING ACTIVITIES
Operating profit before financial items	643	1,168
Depreciation	5	5
Write-downs	-	75
Adjustment for non-cash items	12	–15
Sub-total, cash flow from operating activities	660	1,233
Interest received	43	110
Dividends received	4	741
Interest paid and other financial expenses	–87	–42
Repaid/paid tax	64	–86
Cash flow from operating activities before change in working capital	684	1,956
Investments in development properties, etc.	–1,678	–572
Payment on account for development properties, etc.	1,915	792
Increase/decrease in other current receivables, etc.	–357	–301
Increase/decrease in other current operating liabilities	460	–928
Cash flow before investments and sales of project properties	1,024	947
Investment in project properties, etc.	–8	–21
Sale of project properties, etc.	12	122
Cash flow from operating activities	1,028	1,048
INVESTING ACTIVITIES
Investment in property, plant, and equipment	–9	–1
Investment in Group companies and associated companies, etc.	–291	–418
Change in financial assets	9	–23
Cash flow from investing activities	–291	–442
FINANCING ACTIVITIES
Loans raised	153	410
Amortization of debt	–9	–350
Redemption and repurchase of own shares	-	–1,008
Dividend	-	–489
Cash flow from financing activities	144	–1,437
Cash flow for the year	881	–831
Cash and cash equivalents, January 1	997	1,828
Cash and cash equivalents, December 31	1,878	997

j m a n n u a l r e p o r t 2 0 0 9

BALANCE SHEET — PARENT COMPANY , SE Km	Note	2009-12-31	2008-12-31
	1
ASSETS
Non-current assets
Plant, property and equipment
Machinery and equipment	10	11	8
Financial fixed assets	11
Participations in Group companies		1,145	1,141
Non-current interest-bearing receivables in Group companies		189	-
Participations in associated companies		124	104
Non-current receivables in associated companies		43	43
Other non-current receivables		19	7
Deferred tax assets		58	59
		1,578	1,354
Total non-current assets		1,589	1,362
Current assets
Project properties	12	18	15
Development properties	12	2,042	2,536
Participations in tenant-owners associations, etc.	13	148	131
Current receivables
Accounts receivable		161	220
Other current receivables		193	325
Current interest-bearing receivables in Group companies		1,948	1,631
Recognized revenue less progress billings	14	617	691
Prepaid expenses and accrued income		0	7
		2,919	2,874
Cash and cash equivalents	15	1,878	997
Total current assets		7,005	6,553
TOTAL ASSETS		8,594	7,915
EQUITY AND LIABILITIES

Shareholders' equity 1)
Share capital		83	83
Restricted equity		83	83
Share premium reserve		14	11
Undistributed earnings		1,664	141
Net profit for the year		141	1,428
Unrestricted equity		1,819	1,580
Total shareholders' equity		1,902	1,663
Untaxed reserves	16	597	417
Provisions
Provisions for pensions and similar commitments	17	543	538
Product warranty provisions	18	245	215
		788	753
Liabilities
Non-current liabilities
Non-current interest-bearing liabilities	19	245	223
Other non-current liabilities		113	326
		358	549
Current liabilities
Accounts payable		151	250
Current interest-bearing liabilities	19	845	719
Other current liabilities		323	266
Current interest-bearing liabilities to Group companies	19	2,072	1,536
Derivatives		3	14
Current tax liabilities		67	-
Progress billings in excess of recognized revenue	20	1,009	1,210
Accrued expenses and deferred income	21	479	538
		4,949	4,533
TOTAL EQUITY AND LIABILITIES		8,594	7,915
Pledged assets	22	120	120
Contingent liabilities	22	4,773	7,009

1) See the Statement of changes in equity—parent company.

statement of changes in equity—parent company 71

STATEMENT OF CHANGES IN	Share	Share premium	Retained	Total share
EQUITY — PARENT COMPANY , SE Km	capital	reserve	earnings	holders' equity
Opening balance January 1, 2008	89	8	1,698	1,795
Group contributions received	-	-	–97	–97
Tax effect of Group contributions received	-	-	27	27
Redemption of own shares	–6	-	–986	–992
Dividend	-	-	–489	–489
Equity component of convertible debentures	-	3	-	3
Share-based payments regulated with equity instruments	-	-	3	3
Repurchase of own shares	-	-	–15	–15
Net profit for the year	-	-	1,428	1,428
Closing balance, December 31, 2008	83	11	1,569	1,663
Opening balance January 1, 2009	83	11	1,569	1,663
Group contributions received	-	-	125	125
Tax effect of Group contributions received	-	-	–33	–33
Equity component of convertible debentures	-	3	-	3
Share-based payments regulated with equity instruments	-	-	3	3
Net profit for the year	-	-	141	141
Closing balance, December 31, 2009	83	14	1,805	1,902

Number of shares (1 vote/share) as of December 31, 2009, amounts to 83,401,883 (83,401,883) of which JM AB repurchased 185,000 shares (185,000). Par value per share is SEK 1.

The proposed dividend for 2009 is SEK 2.50 per share (0).

NOTe 1 ACCOUNTING AND VALUATION PRINCIPLES

Amounts in SEK million unless stated otherwise.

For the Parent Company's accounting policies, please refer to the Group's accounting and valuation principles page 53.

NOTe 2 EMPLOYEES AND PERSONNEL COSTS

	2009	2008
Average number of employees (all in Sweden)	1,337	1,719
of which men, %	80	81
Wages, salaries, other remuneration and social security expenses
President and Board of Directors	7	9
(variable compensation)	(1)	(2)
Other employees	609	711
(variable compensation)	(49)	(63)
Total salaries and remunerations	616	720
(variable compensation)	(50)	(65)
Social security expenses	320	366
(of which pension costs)	(133)1)	(132)1)
Total Parent Company	936	1,086

1) Of the Parent Company's pension costs, SEK 1.8m (1.8) pertains to the Group's president. The company's outstanding pension commitments to the President amount to SEK 0.4m (0.4). The company has no pension costs or pension commitments to the rest of the Board.

For information about benefits to JM AB senior executives, please see the Group's note 3.

Absence due to illness, Parent Company

Total absence due to illness amounts to 3.5 percent (4.3) of regular working hours. Of total absence due to illness, 13 percent (46) comprises absence due to illness for more than 60 days.

Absence due to illness by age, %	2009	2008
–29 years	5.1	4.5
30–49 years	2.7	3.5
50 and older	3.9	5.4

Absence due to illness by gender, %	2009	2008
Men	3.9	4.8
Women	2.0	2.4

NOTe 3 DEPRECIATION ACCORDING TO PLAN

	2009	2008
Equipment and other tools	–5	–5
Total	–5	–5

The following depreciation rates are applied:

Computers and other equipment 20–33 percent.

NOT e 4	FEES AND REMUNERATION TO AUDITORS
		2009	2008
Ernst & Young
Auditing services		2.9	2.7
Other services		0.1	0.2
Total		3.0	2.9

NOTe 5 GAINS ON THE SALE OF PROPERTIES

	2009	2008
Sales values
Project properties	7	66
Development properties	32	59
Total	39	125
Carrying amount
Project properties	–5	–44
Development properties	–32	–45
Total	–37	–89
Net Result
Project properties	2	22
Development properties	0	14
Total	2	36

72 notes—parent company

NOT e 6	WRITE -DOWN s ON PROPERTIES
	2009	2008
Development properties	-	–75
Total	-	–75

NOTe 7 RESULT FROM FINANCIAL ITEMS

	Result from Group companies		Result from companies	associated		Result from other financial non-current assets		Result from financial current assets		Interest expense and similar profit/ loss items		Total
	2009	2008	2009	2008	2009	2008	2009	2008	2009	2008	2009	2008
Dividend	-	740	2	1	0	0	-	-	-	-	2	741
Sales	4	759	-	-	1	-	-	-	-	-	5	759
Write-down	–138	–1,125	-	-	-	-	-	-	-	-	–138	–1,125
Interest income	-	-	-	-	-	0	9	40	-	-	9	40
Income, reassessment of derivative	-	-	-	-	-	-	16	38	-	-	16	38
Interest income, Group companies	-	-	-	-	4	5	28	30	-	-	32	35
Interest expense	-	-	-	-	-	-	-	-	–66	–29	–66	–29
Expense, reassessment of derivative	-	-	-	-	-	-	-	-	–27	–37	–27	–37
Interest portion in this year's pension costs	-	-	-	-	-	-	-	-	–21	–30	–21	–30
Total	–134	374	2	1	5	5	53	108	–114	–96	–188	392

NOTe 8 APPROPRIATIONS

	2009	2008
Appropriation to tax allocation reserve	–180	–79
Adjustment, previous year's appropriation to tax	-	7
Total	–180	–72

NOTe 10 MACHINERY AND EQUIPMENT

	2009	2008
Opening cost
Opening balance, January 1	67	71
New purchases	9	1
Sales	–6	–5
Closing balance, December 31	70	67
Accumulated depreciation according to plan
Opening balance, January 1	–59	–60
Depreciation for the year	–5	–5
Sales	5	6
Closing balance, December 31	–59	–59
Closing residual value according to plan	11	8

NOT	e 9	TAXES

	2009	2008
Net profit/loss before taxes	275	1,488
Current tax	–133	–87
Deferred tax	–1	27
Total tax	–134	–60
Difference between reported tax and nominal tax rate 26.3 procent (28.0)
Profit before tax 26.3% (28.0)	–72	–417
Adjustment of tax from previous years	–23	6
Non-taxable income	1	422
Non-deductible expense	–38	–69
Tax untaxed reserve (tax allocation reserve)	–2	–3
Reassessment of deferred tax attributable to lower
tax on income 2009	-	–4
Recalculation of deferred tax from previous years	0	5
Total	–134	–60

In 2008 the Swedish National Tax Agency (Skatteverket) audited JM for the assessment years 2006 and 2007. The tax notice in December 2008 levied a tax of SEK 66m, which was paid in January 2009. JM has appealed parts of the decision to the County Administrative Court, which has not yet ruled in the case. After analysis during the year and with support of an external tax consultant, JM expects that SEK 45m will be refunded; no provision was made in the financial statements for this amount.

The Supreme Administrative Court rulings in 2009, in legal cases relating to the Swedish tax avoidance act in conjunction with transactions in which properties are sold at a loss, increase the risk of processes relating to the Company's management of transactions from earlier years in conjunction with certain write-downs of participations in subsidiaries. A provision remains for this risk at the Group level, even though the tax returns were approved.

NOTe 11 FINANCIAL FI XED ASSETS

		Participa tions in Group companies	Long-term interest bearing receiv ables in Group companies		Participa tions in associated companies		Long-term receivables in associated companies		Other long-term securities			Long-term receivables	receivables	Deferred tax		Total
	2009	2008	2009	2008	2009	2008	2009	2008	2009	2008	2009	2008	2009	2008	2009	2008
Opening cost
Opening balance, January 1	1,141	1,098	-	320	104	80	43	43	0	0	7	8	59	32	1,354	1,581
New purchases	141	1,214	-	-	30	24	-	-	-	-	-	-	-	-	171	1,238
Additional receivables	-	-	189	-	-	-	-	-	-	-	8	-	5	27	202	27
Settled receivables	-	-	-	–320	-	-	-	-	-	-	–6	–1	–6	-	–12	–321
Merger	-	–1	-	-	-	-	-	-	-	-	-	-	-	-	-	–1
Reclassification	-	-	-	-	–10	-	-	-	-	-	10	-	-	-	-	-
Sales	-	–45	-	-	-	-	-	-	-	-	-	-	-	-	-	–45
Write-downs for the year 1)	–137	–1,125	-	-	-	-	-	-	-	-	-	-	-	-	–137	–1,125
Closing balance,
­December 31	1,145	1,141	189	-	124	104	43	43	0	0	19	7	58	59	1,578	1,354

For specification of the Parent Company's and the Group's participation in wholly owned associated companies and group companies, see the Group's notes 14 and 16. 1) Shares in subsidiary were written down to equal the value of equity.

NOTe 12 PROJECT PROPERTIES AND DEVELOPMENT PROPERTIES

	Project properties			Development properties
	2009	2008	2009	2008
Opening cost
Opening balance, January 1	15	56	2,656	2,907
New purchases	8	21	229	414
Merger	-	-	-	5
Transferred to production	-	–18	–691	–618
Sales	–5	–44	–32	–52
Closing balance, December 31	18	15	2,162	2,656
Accumulated write-downs
Opening balance, January 1	-	-	–120	–52
Write-downs for the year	-	-	-	–75
Sales	-	-	-	7
Closing balance, December 31	-	-	–120	–120
Closing residual value accord
ing to plan	18	15	2,042	2,536
Tax assessment values	1	1	2,804	2,389

Reported residual value for the part of development properties recognized at fair value amounts to SEK 69m (112).

NOTe 13 PARTICIPATIONS IN TENANT -OWNERS associations ETC .

	2009	2008
Opening cost
Opening balance, January 1	131	73
New purchases	1,178	277
Sales	–1,161	–219
Closing balance, December 31	148	131

NOTe 14 RECOGNIZED REVENUE LESS

PROGRESS BILLINGS

	2009	2008
Recognized revenue in work in progress	2,668	2,052
Accumulated billing on account for work in progress	–2,051	–1,361
Total	617	691

NOTe 15 CASH AND CASH EQUIVALENTS

	2009	2008
Cash and bank balances	678	997
Short-term investments	1,200	-
Total	1,878	997

Short-term investments have a maturity ranging from 1 day up to 3 months.

NOTe 16 UNTAXED RESERVES

	2009	2008
Tax allocation reserve, 2007 taxation	129	129
Tax allocation reserve, 2008 taxation	209	209
Tax allocation reserve, 2009 taxation	79	79
Tax allocation reserve, 2010 taxation	180	-
Total	597	417

NOTe 17 PROVISIONS FOR PENSIONS AND SIMILAR COMMITMENTS

	2009	2008
Opening balance, January 1	538	510
Benefits earned during the period	12	12
Interest expense	19	18
Payment of pensions	–19	–15
Other	–7	13
Closing balance, December 31	543	538

In the Parent Company only the ITP plan is entered as a liability as a pension provision; it has no assets that protect the commitment.

NOTe 18 PRODUCTWARRANTY PROVISIONS

	2009	2008
Opening balance, January 1	215	198
Utilized/Dissolution	–79	–137
Provisions	109	154
Closing balance, December 31	245	215

NOTe 19 INTEREST-BEARING LIABILITIES

Long-term interest-bearing liabilities	2009	2008
Other liabilities 1–5 years from closing day	14	21
Convertible loan 1–5 years	231	202
Total	245	223
Current interest-bearing liabilities	2009	2008
Other current liabilities	845	719
Liabilities to Group companies	2,072	1,536
Total	2,917	2,255

The item "Other current liabilities" in 2009 refers to a note payable at the amount of SEK 719m for the acquisition of Dalénum in 2007.

Liabilities to credit institutions,

confirmed credits	2009	2008
Bank overdraft facility	400	400
Granted credit agreement maturity within 1 year	700	850
Granted credit agreement maturity more than 1 year	1,700	1,550
Unused part	–2,800	–2,800
Used credit agreement	-	-

Credit agreements carry fixed interest.

NOTe 20 PROGRESS BILLINGS IN EXCESS OF RECOGNI ZED REVENUE

	2009	2008
Accumulated billing on account for work in progress	14,628	15,780
Recognized revenue in work in progress	–13,619	–14,570
Total	1,009	1,210

NOTe 21 ACCRUALS AND DEFERRED INCOME

	2009	2008
Personnel-related items	298	370
Prepaid rental income	5	5
Other accruals	176	163
Total	479	538

NOTe 22 PLEDGED ASSETS AND CONTINGENT LIABILITIES

	2009	2008
Assets pledged to secure own provisions
and liabilities
Corporate mortgages 1)	100	100
Property mortgages	20	20
Total	120	120
Contingent liabilities
Guarantee commitments, other 2)	3,321	5,039
Guarantees on behalf of Group companies 3)	1,205	1,758
Guarantees in connection with assignments	230	193
Payment and rental guarantees	5	7
Other contingent liabilities	12	12
Total	4,773	7,009

1, 2) See the Group's note 29 for comments.

3) Guarantees on behalf of Group companies mainly relate to commitments for foreign companies and the subsidiaries Seniorgården AB and JM Entreprenad AB.

74 five-year overview—group

Amounts in SEK million unless stated otherwise.

INCOME STATEMENT	2009	2008	2007	2006	2005
Income	8,778	12,229	12,731	12,065	9,887
Production and operating costs	–7,501	–10,180	–9,939	–9,737	–8,327
Gross profit	1,277	2,049	2,792	2,328	1,560
Selling and administrative expenses	–615	–719	–673	–616	–576
Gains on the sale of properties	89	73	182	169	247
Write-downs on properties	–87	–320	-	-	-
Operating profit	664	1,083	2,301	1,881	1,231
Financial income and expenses	–117	–31	–4	–29	–80
Profit before tax	547	1,052	2,297	1,852	1,151
Taxes	–168	–234	–632	–284	–175
Net profit for the year	379	818	1,665	1,568	976
INCOME STATEMENT BY FUNCTION Production
Recognized revenue	8,644	12,027	12,555	11,894	9,615
Production costs	–7,377	–10,002	–9,805	–9,609	–8,137
Profit from production operations	1,267	2,025	2,750	2,285	1,478
Development properties
Rental income	66	85	94	95	80
Operating expenses	–34	–57	–58	–67	–60
Property tax	–21	–21	–18	–14	–11
Profit from development properties	11	7	18	14	9
Project properties
Rental income	68	117	82	76	192
Operating expenses	–66	–98	–56	–46	–112
Property tax	–3	–2	–2	–1	–7
Profit from project properties	–1	17	24	29	73
Gross profit	1,277	2,049	2,792	2,328	1,560
Selling and administrative expenses	–569	–662	–624	–571	–513
Property sales
Sales values	665	748	653	1,000	1,752
Carrying amount	–576	–675	–471	–831	–1,505
Gains on the sale of properties	89	73	182	169	247
Write-downs on properties Group-wide expenses	–87 –46	–320 –57	- –49	- –45	- –63
Operating profit	664	1,083	2,301	1,881	1,231
BALANCE SHEET	Dec 31, 2009	Dec 31, 2008	Dec 31, 2007	Dec 31, 2006	Dec 31, 2005
ASSETS
Non-current assets	258	184	121	118	134
Project properties	596	614	790	823	1,183
Development properties	4,990	5,620	5,282	4,348	2,925
Participations in tenant-owners associations, etc.	353	171	104	73	38
Current receivables 1)	1,703	2,355	1,558	1,535	1,241
Cash and cash equivalents	2,030	1,111	2,061	1,509	2,634
Total current assets	9,672	9,871	9,795	8,288	8,021
TOTAL ASSETS	9,930	10,055	9,916	8,406	8,155
2) EQUITY AND LIABILITIES
Shareholders' equity	3,668	3,241	3,893	3,590	3,311
Long-term interest-bearing liabilities	326	314	216	73	626
Other non-current liabilities	113	271	978	597	-
Long-term provisions	1,693	1,579	1,358	938	850
Total non-current liabilities	2,132	2,164	2,552	1,608	1,476
Current interest-bearing liabilities	951	1,137	45	114	22
Other current liabilities	3,046	3,401	3,321	3,024	3,283
Current provisions	133	112	105	70	63
Total current liabilities	4,130	4,650	3,471	3,208	3,368
TOTAL EQUITY AND LIABILITIES	9,930	10,055	9,916	8,406	8,155
1) Of which receivables from property sales	3	474	64	2	37
2) Of which liabilities for property acquisition	962	1,140	1,600	998	260

CASH FLOW STATEMENT	2009	2008	2007	2006	2005
Cash flow from operating activities	1,124	101	1,826	667	3,368
Cash flow from investing activities	–51	–4	–7	–7	6
Cash flow from financing activities	–158	–1,055	–1,279	–1,782	–2,025
Total cash flow for the year	915	–958	540	–1,122	1,349
Cash and cash equivalents, December 31	2,030	1,111	2,061	1,509	2,634
INTEREST -BEARING NET LIABILITIES /RECEIVABLES
Interest-bearing net liabilities (+)/receivables (–), January 1	842	–1,313	–852	–1,536	613
Change in interest-bearing net liabilities/receivables	–1,031	2,155	–461	684	–2,149
Interest-bearing net liabilities (+)/receivables (–), December 31	–189	842	–1,313	–852	–1,536
DEVELOPMENT PROPERTIES
Carrying amount, January 1	5,620	5,282	4,348	2,925	2,971
New purchases	428	1,571	2,130	2,718	1,337
Transferred to production	–910	–781	–1,159	–1,168	–1,232
Write-downs	–87	–320	-	-	-
Other	–61	–132	–37	–127	–151
Carrying amount, December 31	4,990	5,620	5,282	4,348	2,925
Housing production
Number of available building rights	27,900	31,000	31,000	29,800	23,200
—recognized in the balance sheet	18,400	20,100	19,200	19,300	15,000
Number of residential units sold	3,291	1,871	3,880	3,790	4,240
Number of housing starts	2,150	1,829	4,065	4,132	4,476
PRO JECT PROPERTIES
Market values	610	669	1,052	1,063	1,448
Carrying amount	596	614	790	823	1,183
Surplus values before deferred tax	14	55	262	240	265
PERSONNEL
Average number of employees	2,095	2,533	2,385	2,286	2,249
—abroad	247	353	318	343	272
Wages, salaries and remunerations	969	1,086	982	888	853
KEY FIGURES
Operating margin (%) 1)	7.6	8.9	18.1	15.6	12.5
Return on equity after tax (%)	11.0	22.9	44.5	45.4	28.8
Pre-tax return on capital employed (%)	13.2	23.8	52.9	44.4	26.0
Pre-tax return on total capital (%)	7.1	11.7	25.7	23.3	15.6
Equity/assets ratio (%) 1)	37	32	39	43	41
Interest-bearing loan (SEKm)	1,842	1,964	760	669	1,120
Debt/equity ratio (times)	-	0.3	-	-	-
Interest coverage ratio (times)	4.5	9.8	39.9	25.4	10.1
Interest-bearing liabilities/total assets (%)	19	20	8	8	14
Asset turnover rate (times)	0.88	1.22	1.39	1.46	1.21

1) Financial targets:

Operating margin should amount to 10 percent, including gains from property sales of 1–2 percentage points.

The visible equity ratio should amount to 35 percent over a business cycle.  To the extent the visible equity ratio and interest coverage are assessed as exceeding the optimal capital structure on a continuing basis, capital will be transferred to shareholders in a form that is appropriate at the time.

INTEREST-BEARING NET LIABILITIES/RECEIVABLES AND DEBT/EQUITY RATIO

Amounts in SEK million unless stated otherwise.

			2009			2008
INCOME STATEMENT	Full-year	Q 4	Q 3	Q 2	Q 1	Full-year	Q 4	Q 3	Q 2	Q 1
Income	8,778	2,539	1,818	2,302	2,119	12,229	2,850	2,550	3,663	3,166
Production and operating costs	–7,501	–2,102	–1,525	–2,007	–1,867	–10,180	–2,626	–2,116	–2,926	–2,512
Gross profit	1,277	437	293	295	252	2,049	224	434	737	654
Selling and administrative expenses	–615	–150	–115	–181	–169	–719	–167	–158	–194	–200
Gains on the sale of properties	89	38	10	28	13	73	52	0	18	3
Write-downs on properties	–87	0	-	–87	-	–320	–320	-	-	-
Operating profit	664	325	188	55	96	1,083	–211	276	561	457
Financial income and expenses	–117	–22	–31	–34	–30	–31	–13	–14	–4	0
Profit before tax	547	303	157	21	66	1,052	–224	262	557	457
Taxes	–168	–94	–48	–7	–19	–234	127	–74	–158	–129
Net profit for the period	379	209	109	14	47	818	–97	188	399	328

	Dec 31,	Sept 30,	June 30,	March 31,	Dec 31,	Sept 30,	June 30,	Mar. 31,
BALANCE SHEET	2009	2009	2009	2009	2008	2008	2008	2008
ASSETS
Non-current assets	258	271	147	109	184	108	130	117
Project properties	596	804	731	636	614	856	802	809
Development properties	4,990	5,203	5,391	5,623	5,620	6,160	5,640	5,748
Participations in tenant-owners associations, etc.	353	307	416	290	171	159	155	90
Current receivables	1,703	2,054	2,154	2,583	2,355	2,054	2,243	1,697
Cash and cash equivalents	2,030	1,084	1,294	858	1,111	578	663	1,797
Total current assets	9,672	9,452	9,986	9,990	9,871	9,807	9,503	10,141
TOTAL ASSETS	9,930	9,723	10,133	10,099	10,055	9,915	9,633	10,258
EQUITY AND LIABILITIES
Shareholders' equity	3,668	3,431	3,352	3,355	3,241	3,327	3,122	4,205
Long-term interest-bearing liabilities	326	306	323	315	314	315	261	224
Other non-current liabilities	113	236	236	271	271	1,120	1,154	1,197
Long-term provisions	1,693	1,673	1,526	1,514	1,579	1,652	1,634	1,409
Total non-current liabilities	2,132	2,215	2,085	2,100	2,164	3,087	3,049	2,830
Current interest-bearing liabilities	951	793	1,212	1,349	1,137	82	63	17
Other current liabilities	3,046	3,160	3,369	3,175	3,401	3,288	3,276	3,101
Current provisions	133	124	115	120	112	131	123	105
Total current liabilities	4,130	4,077	4,696	4,644	4,650	3,501	3,462	3,223
TOTAL EQUITY AND LIABILITIES	9,930	9,723	10,133	10,099	10,055	9,915	9,633	10,258

			2009				2008
CASH FLOW STATEMENT	Full-year	Q 4	Q 3	Q 2	Q 1	Full-year	Q 4	Q 3	Q 2	Q 1
Cash flow from operating activities	1,124	780	179	629	–464	101	242	–196	290	–235
Cash flow from investing activities	–51	–7	–3	–45	4	–4	–21	37	–13	–7
Cash flow from financing activities	–158	172	–386	–147	203	–1,055	306	72	–1,414	–19
Total cash flow for the period	915	945	–210	437	–257	–958	527	–87	–1,137	–261
Cash and cash equivalents at end
of the period	2,030	2,030	1,084	1,294	858	1,111	1,111	578	663	1,797
INTEREST -BEARING NET LIABILITIES	/RECEIVABLES
Interest-bearing net liabilities (+)/
receivables (–) at beginning of period	842	536	763	1,313	842	–1,313	304	132	–1,076	–1,313
Change in interest-bearing net
liabilities/receivables	–1,031	–725	–227	–550	471	2,155	538	172	1,208	237
Interest-bearing net liabilities (+)/
receivables (–) at end of period	–189	–189	536	763	1,313	842	842	304	132	–1,076
DEVELOPMENT PROPERTIES
Opening balance at beginning of period	5,620	5,203	5,391	5,623	5,620	5,282	6,160	5,640	5,748	5,282
New purchases	428	185	103	98	42	1,571	161	665	138	607
Transferred to production	–910	–377	–233	–175	–125	–781	–243	–171	–246	–121
Write-downs	–87	0	-	–87	-	–320	–320	-	-	-
Other	–61	–21	–58	–68	86	–132	–138	26	0	–20
Closing balance at end of period	4,990	4,990	5,203	5,391	5,623	5,620	5,620	6,160	5,640	5,748
KEY FIGURES
Operating margin (%)	7.6	12.8	10.3	2.4	4.5	8.9	–7.4	10.8	15.3	14.4
Debt/equity ratio (times)	-	-	0.2	0.2	0.4	0.3	0.3	0.1	0.0	-
Equity/assets ratio (%)	37	37	35	33	33	32	32	34	32	41
Earnings per share (SEK)	4.60	2.50	1.30	0.20	0.60	9.50	–1.20	2.30	4.50	3.70
Number of available building rights	27,900	27,900	29,000	30,500	30,600	31,000	31,000	32,900	33,000	32,500
Number of residential units sold	3,291	908	879	940	564	1,871	270	307	674	620
Number of housing starts	2,150	704	763	536	147	1,829	346	246	733	504

quarterly overview—business segments 77

		2009						2008
JM RESIDENTIAL STOC KHOLM	Full-year	Q 4	Q 3	Q 2	Q 1	Full-year	Q 4	Q 3	Q 2	Q 1
Income	3,330	989	696	754	891	5,317	1,301	1,035	1,615	1,366
Operating profit 1)	496	170	101	105	120	920	88	165	375	292
Operating margin (%)	14.9	17.2	14.5	13.9	13.5	17.3	6.8	15.9	23.2	21.4
Average operating capital	1,981	1,981	2,090	2,130	2,184	2,012	2,012	1,867	1,672	1,461
Return on operating capital (%) 2)	25.0	25.0	19.8	22.4	34.3	45.7	45.7	68.6	82.5	88.4
Operating cash flow	544	226	92	310	–84	1,090	442	13	410	225
Carrying amount, development properties	2,111	2,111	2,253	2,354	2,376	2,432	2,432	2,718	2,325	2,531
Number of available building rights	10,700	10,700	11,200	12,200	11,800	12,200	12,200	12,800	12,900	12,500
Number of residential units sold3)	1,713	456	538	434	285	1,061	97	147	425	392
Number of housing starts 4)	1,102	360	461	190	91	973	50	23	568	332
1) Of which —property sales	2	2	-	-	-	-	-	-	-	-
—write-downs on properties	-	-	-	-	-	–140	–140	-	-	-
3) Of which rental units	562	107	224	70	161	-	-	-	-	-
4) Of which rental units	492	107	224	70	91	-	-	-	-	-

		2009						2008
JM RESIDENTIAL SWEDEN	Full-year	Q 4	Q 3	Q 2	Q 1	Full-year	Q 4	Q 3	Q 2	Q 1
Income	2,296	654	424	646	572	3,263	612	683	1,015	953
Operating profit 1)	166	80	39	35	12	197	–122	61	126	132
Operating margin (%)	7.2	12.2	9.2	5.4	2.1	6.0	–19.9	8.9	12.4	13.9
Average operating capital	1,597	1,597	1,600	1,633	1,617	1,447	1,447	1,328	1,184	1,039
Return on operating capital (%) 2)	10.4	10.4	–2.2	–0.9	4.8	13.6	13.6	40.6	53.4	64.9
Operating cash flow	70	–35	212	151	–258	–203	–186	100	29	–146
Carrying amount, development properties	1,451	1,451	1,509	1,500	1,547	1,546	1,546	1,671	1,645	1,606
Number of available building rights	10,200	10,200	10,100	10,700	11,000	11,000	11,000	11,900	11,800	11,500
Number of residential units sold3)	973	258	203	300	212	564	137	119	139	169
Number of housing starts 4)	689	225	237	181	46	597	237	118	131	111
1) Of which —property sales	0	-	0	0	-	–1	–1	-	-	-
—write-downs on properties	-	-	-	-	-	–40	–40	-	-	-

		2009					2008
JM INTERNATIONAL	Full-year	Q 4	Q 3	Q 2	Q 1	Full-year	Q 4	Q 3	Q 2	Q 1
Income	1,353	484	284	321	264	2,058	418	435	661	544
Operating profit 1)	–192	9	4	–136	–69	–176	–243	18	28	21
Operating margin (%)	–14.2	1.9	1.4	–42.4	–26.1	–8.6	–58.1	4.1	4.2	3.9
Average operating capital	1,936	1,936	1,937	1,977	1,965	1,800	1,800	1,630	1,464	1,313
Return on operating capital (%) 2)	–9.9	–9.9	–22.9	–21.7	–13.5	–9.8	–9.8	8.7	9.6	12.0
Operating cash flow	–174	–115	97	39	–195	–657	–102	–146	–91	–318
Carrying amount, development properties	1,320	1,320	1,361	1,457	1,620	1,562	1,562	1,670	1,560	1,501
Carrying amount, project properties	32	32	31	60	68	61	61	58	31	29
Number of available building rights	7,000	7,000	7,700	7,600	7,800	7,800	7,800	8,200	8,300	8,500
Number of residential units sold3)	605	194	138	206	67	246	36	41	110	59
Number of housing starts 4)	359	119	65	165	10	259	59	105	34	61
1) Of which —property sales	12	2	10	-	-	-	-	-	-	-
—write-downs on properties	–87	-	-	–87	-	–140	–140	-	-	-
3) Of which rental units	48	-	14	34	-	-	-	-	-	-
4) Of which rental units	48	-	14	34	-	-	-	-	-	-
			2009					2008
JM PROPERTY DEVELOPMENT	Full-year	Q 4	Q 3	Q 2	Q 1	Full-year	Q 4	Q 3	Q 2	Q 1
Income	309	60	100	76	73	213	58	53	61	41
Operating profit 1)	110	42	16	28	24	75	42	9	19	5
Average operating capital	1,021	1,021	1,081	1,031	1,016	972	972	949	965	983
Return on operating capital (%) 2)	10.8	10.8	10.2	10.0	9.3	7.7	7.7	6.6	9.2	9.8
Operating cash flow	620	571	–181	127	103	–113	–78	–54	–3	22
Carrying amount, development properties	108	108	80	80	80	80	80	101	110	110
Carrying amount, project properties	564	564	773	671	568	553	553	798	771	780
1) Of which property sales	75	34	-	28	13	74	53	0	18	3
			2009					2008
JM PRODUCTION	Full-year	Q 4	Q 3	Q 2	Q 1	Full-year	Q 4	Q 3	Q 2	Q 1
Income	2,008	478	450	577	503	2,008	606	529	459	414
Operating profit	130	37	34	37	22	124	44	32	26	22
Operating margin (%)	6.5	7.7	7.6	6.4	4.4	6.2	7.3	6.0	5.7	5.3

JM OTHER		2009					2008
	Full-year	Q 4	Q 3	Q 2	Q 1	Full-year	Q 4	Q 3	Q 2	Q 1
Income (elimination)	–518	–126	–136	–72	–184	–630	–145	–185	–148	–152
Operating profit (Group-wide expenses)	–46	–13	–6	–14	–13	–57	–20	–9	–13	–15

Operating cash flow 173 85 65 –39 62 162 39 51 39 33

2) Calculated on 12-month rolling profits and average capital.

The Board of Directors and the President propose that the Parent Company's net profit for the year of SEK 141,059,101 and retained earnings of SEK 1,677,277,902, for a total of SEK 1,818,337,003, be distributed as follows:

Dividend to shareholders: SEK 2.50

per share,	SEK 208,042,208
To be carried forward to new account	SEK 1,610,294,795
	SEK 1,818,337,003

The number of registered shares as of Dec. 31, 2009 was 83,401,883, including 185,000 that are repurchased shares, which are not entitled to dividend.

The undersigned certify that the consolidated accounts and the annual report have been prepared in accordance with International Financial Reporting Standards (IFRS), as adopted for use in the European Union, and generally accepted accounting principles respectively, and give a true and fair view of the financial positions and results of the Group and the Company, and that the management reports of the Group and the Company give a fair review of the development of the operations, financial positions and results of the Group and the Company and describes substantial risks and uncertainties that the Group companies face.

Stockholm February 25, 2010

Lars Lundquist Chairman of the Board

Board member Board member Board member

Elisabet  Annell Anders Narvinger Åsa Söderström Jerring

Torbjörn Torell Jonatan Sundelin Johan Wegin Board member Board member appointed Board member appointed by the employees by the employees

Johan Skoglund Board member President and Chief Executive Officer

STATEMENT BY THE BOARD OF DIRECTORS PURSUANT TO THE SWEDISH COMPANIES ACT , CHAPTER 18 SECTION 4 ON THE PROPOSED DIVIDEND FOR 2009

At the end of 2009 the financial position was strong. The Group's interestbearing receivables totaled SEK 0.2bn.

The proposed dividend to shareholders decreases the Group's visible equity/assets ratio from 37 to 36 percent and the Parent Company's visible equity/assets ratio from 27 to 25 percent. The Group's adjusted equity/ assets ratio is substantially higher when taking into account the excess value of the Group's holdings of project and development properties.

The Group conducts its business with good demand in the majority of JM's housing markets and improved profitability during the year, following a period with weak demand and turbulence in the financial system.

It is the Board's opinion that after the proposed dividend JM will continue to have the financial capacity to meet the requirements that the operation's nature, scope, investment needs and risks place on the shareholders' equity of both the Group and the Parent Company. The proposal is therefore reasonable, taking into account the Group and the Parent Company's needs for consolidation, liquidity and position in general, which means that the proposal does not prevent the Company and other companies in the Group from meeting their short- and long-term obligations.

Stockholm, February 11, 2010

JM AB (publ)

Board of Directors

TO THE ANNUAL MEET ING OF THE SHARE HOL DER S OF JM AB, CORPORATE IDENT ITY NUM BER 556045-2103

We have audited the annual accounts, the consolidated accounts, the accounting records and the administration of the Board of Directors and the President of JM for the financial year 2009. The Compay's annual accounts and consolidated financial statements are included in the printed version of this document on pages 43–78. The Board of Directors and the President are responsible for these accounts and the administration of the Company as well as for the application of the Annual Accounts Act when preparing the annual accounts and the application of international financial reporting standards IFRS as adopted by the EU and the Annual Accounts Act when preparing the consolidated accounts. Our responsibility is to express an opinion on the annual accounts, the consolidated accounts and the administration based on our audit.

We conducted our audit in accordance with generally accepted auditing standards in Sweden. Those standards require that we plan and perform the audit to obtain reasonable assurance thatthe annual accounts and the consolidated accounts are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the accounts. An audit also includes assessing the accounting principles used and their application by the Board of Directors and the President and significant estimates made by the Board of Directors and the President when preparing the annual accounts and consolidated accounts as well as evaluating the overall presentation of information in the annual accounts and the consolidated accounts. As a basis for our opinion concerning discharge from liability, we examined significant decisions, actions taken and circumstances of the Company in order to be able to determine the liability, if any, to the company of any board member or the President. We also examined whether any board member or the President has, in any other way, acted in contravention of the Companies Act, the Annual Accounts Act or the Articles of Association. We believe that our audit provides a reasonable basis for our opinion set out below. The annual accounts have been prepared in accordance with the Annual Accounts Act and give a true and fair view of the Company's financial position and results of operations in accordance with generally accepted accounting principles in Sweden. The consolidated accounts have been prepared in accordance with the international financial reporting standards IFRS as adopted by the EU and the Annual Accounts Act and give a true and fair view of the Group´s financial position and results of operations. The statutory administration report is consistent with the other parts of the annual accounts and the consolidated accounts.

We recommend to the annual meeting of shareholders that the income statements and balance sheets of the Parent Company and the Group be adopted, that the profit of the Parent Company be dealt with in accordance with the proposal in the administration report and that the members of the Board of Directors and the President be discharged from liability for the financial year.

Stockholm February 25, 2010

Ernst & Young AB

Ingemar Rindstig Jonas Svensson Authorized Public Authorized Public Accountant Accountant

DEFINITIONS KEY FINANCIAL MEASURES

Amounts in SEKm unless stated otherwise.

Dividend yield

Proposed dividend in relation to market price at December 31, 2009.

Proposed dividend	SEK 2.50
Share price	SEK 123
	2.0%

Total return

The sum of the change in share price during the year, dividend paid and redemption rights in relation to the share price at the beginning of the year.

Change in share price			SEK 80
Share price, January 1			SEK 43
			186%

Asset turnover rate

Income for the year divided by average total assets.
Income	8,778
Average total assets	9,993

Earnings per share, basic

Profit for the year attributable to shareholders of the Parent Company in relation to average number of shares.

Net profit for the year	379
Average number of shares	83,216,883
	4.60 kr

Return on equity

Profit for the year as a percentage of average shareholders' equity.
Net profit for the year	379
Average shareholders' equity	3,455
	11.0%

Return on capital employed

Profit before tax plus financial expenses as a percentage of average capital employed.

Profit before tax plus financial expenses	705
Average capital employed	5,358
	13.2%

Return on equity on total capital

Profit before tax plus financial expenses as a percentage of average total assets.
Profit before tax plus financial expenses	705
Average total assets	9,993

Interest coverage ratio

Profit before tax plus financial expenses in relation to financial expenses.
Profit before tax plus financial expenses	705
Finance expenses	158
	4.5 times

Operating margin

Operating result including property sales and impairment losses on properties in relation to revenues.

Operating profit	664
Income	8,778
	7.6%

Equity/assets ratio

Shareholders' equity as a percentage of total assets.

Shareholders' equity	3,668
Total assets	9,930
	37%

GLOSSARY

Development properties

Mainly refers to land that can be developed for future projects; classified as current assets.

• Land with residential building rights
• Land with commercial building rights
• Developed properties for residential projects or further development to project properties.

A presentation of a selection of JM's larger development properties can be found on pages 93–94.

Revenue

0.88 times

7.1%

Rental income and recognized revenue according to the percentage of completion method.

Operating capital

Total goodwill, project properties, development properties, participations in tenantowners associations, receivables from property sales, receivables from tenant-owners associations sold, and accounts receivable, revenue less progress billings minus accounts payable, property purchases and progress billings in excess of recognized revenue.

Average operating capital is calculated as closing operating capital on five measurement dates (five most recent quarters).

Operating cash flow

Change in operating capital plus profit for the period adjusted for non-cash items.

Project properties

Classified as current assets and comprise large property portfolios for further development and commercial properties.

• Residential units (tenancy rights)
• Properties under development • Fully developed commercial properties.

A summary of JM's project properties can be found on pages 95.

Interest-bearing net liabilities /receivables

Interest-bearing receivables and cash and cash equivalents minus interest bearing liabilities and provisions.

Debt/equity ratio Interest-bearing net debt in relation to shareholders' equity.

Capital employed

Shareholders' equity plus loans.

Recognized revenue (according to percentage of completion method) Revenue is recognized period by period, as projects are completed and sold.

A more detailed description can be found in the section Accounting and valuation principles on page 53–55.

contents	page
corporate governance report	82
board of directors and auditors	88
executive management	89
the jm share	90
notice of annual general meeting and financial calendar	92

CORPORATE GOVERNANCE REPORT FOR THE 2009 FINANCIAL YEAR

BACKGROUND

JM has complied with and applied the Swedish Code of Corporate Governance (the "Code") ever since its inception. Code requirements include enclosing a separate report on corporate governance issues with JM's annual report. The code allows noncompliance with the rules, provided that the reason is clearly presented according to the "comply or explain" principle. However, JM complies with the Code without exception.

JM's aspiration is to continue working systematically to further strengthen its internal control and governance, while increasing the knowledge of shareholders and other stakeholders about how the Board of Directors and the administration operate in order to ensure that shareholders' demand for return on invested capital is met. Priority areas include high ethical standards, JM's core values, professionalism, transparency and JM's contribution to social development. For more information about JM's contributions to sustainable urban planning, please refer to pages 28–33.

JM has been working on corporate governance issues for several years, resulting in improved control and oversight with respect to investment, sales and production decisions, as well as during the project implementation phase. Internal control and governance are also exercised through the systematic committee work of the Board. The Board undergoes an annual evaluation process to help them develop.

COMPLIANCE WITH THE CODE

JM complies with the Code without exception.

ANNUAL GENERAL MEETING

The Annual General Meeting is the decision-making body at which all shareholders can participate. The Annual General Meeting (the general meeting at which the consolidated accounts and auditors' report on the consolidated accounts are presented) addresses the company's developments, and decisions are taken in several key issues, such as dividends, discharge from liability for the Board, election of auditors (every fourth year), compensation to the Board of Directors and auditors, as well as election of a new Board up until the next Annual General Meeting.

The Company publishes notification of the Annual General Meeting no earlier than six weeks and no later than four weeks before the meeting. The Company announces the time and place of the Annual General Meeting in connection with the third quarter report, usually in late October. The possibility of foreign shareholders following or participating in the Annual General Meeting through simultaneous interpretation or translation of presented materials into other languages has not been considered necessary since to date, such shareholders have been represented by Swedish representatives.

The 2009 Annual General Meeting was held on April 28. A total of 54 shareholders were present or represented by proxy, representing 45 percent of the total voting power in the Company. Minutes from the Annual General Meeting can be found on JM's website (www.jm.se).

The 2010 Annual General Meeting will be held on April 28.

NOMINATION COMMITTEE

Board Members are nominated by a Nomination Committee prior to election at the Annual General Meeting. This committee consists of representatives for the four largest shareholders in the company, at any time, who wish to participate. The Chairman of the Board is the fifth member and convenes the meeting. The Nomination Committee's task is mainly to submit proposals for Directors and their remuneration and, when appropriate, to submit proposals for election of auditors.

The Chairman of the Board convened the Nomination Committee for the 2010 Annual General Meeting in September 2009 and it consists of the following:

Lars-Åke Bokenberger representing AMF Pension KG Lindvall representing Swedbank Robur Funds Anders Algotsson representing AFA Försäkringar Per-Erik Mohlin representing SEB Fonder/SEB Trygg Liv

Lars Lundquist, chairman of the Board of JM.

At the time it was appointed, the Nomination Committee represented about 30 percent of the total number of JM shares. Lars-Åke Bokenberger is chairman of the committee. The Nomination Committee convened two times and also corresponded by e-mail and spoke on the telephone.

Directors on the Nomination Committee have not received any compensation from JM.

At the recommendation of the Nomination Committee, the 2008 Annual General Meeting re-elected Ernst & Young AB as its auditing company. Responsible auditors are Ingemar Rindstig and Jonas Svensson. The election covers the period up until the 2012 Annual General Meeting. In addition to JM, Ingemar Rindstig provides auditing services to clients such as Besqab, Castellum, Jernhusen, Sagax, Svenska Bostäder, Vasakronan, Veidekke and Wallenstam. In addition to JM, Jonas Svensson provides auditing services to clients such as Besqab, ByggPartner, Sagax and Vattenfall. Ingemar Rindstig and Jonas Svensson have no assignments with other companies that affect their independence as auditors for JM. Information about the auditing company's services to JM in addition to auditing is provided in note 5 on page 60.

JM'S BOARD OF DIRECTORS

COMPOSITION

According to the Articles of Association, JM's Board of Directors shall consist of a minimum of three and a maximum of nine directors. The Board's directors are elected by the Annual General Meeting for one year at a time. In addition, the employee organizations are legally entitled to appoint two ordinary directors as well as two deputies.

The 2009 Annual General Meeting elected seven directors. The employee organizations have appointed two directors and two deputies. Berthold Lindqvist, who was member of the Board of Directors and Chairman of the Audit Committee, passed away in December 2009.

The composition of the Board of Directors can be seen below, as can participation in committees (A = Audit Committee, C = Compensation Committee, I = Investment Committee) and attendance during 2009. Approved remuneration is reported on page 86. The Board of Directors held nine meetings, two of which were per telephone and one per capsulam (meeting by letter).

The Audit Committee held four meetings.

The Compensation Committee held five meetings.

The Investment Committee held two meetings.

				Attend	Attend
Name	Function		Elected Committee	ance B	ance C
Lars Lundquist	chairman	2005	(chairman) C	9	5
			(chairman) I		2
Elisabet Annell	board member	2002	A	9	4
Eva-Britt Gustafsson	board member	2005		42)
Bengt Larsson	board member	2004	C	42)	2
Berthold Lindqvist4)	board member	2001	(chairman) A	8	4
Anders Narvinger	board member	2009	A	53)	23)
Johan Skoglund	board member	2003	-	9
Åsa Söderström Jerring board member		2007	I	9	2
			C		2
Torbjörn Torell	board member	2004	I	8	1
Jonatan Sundelin	emp.rep.	2004	-	9
Johan Wegin	emp.rep.	2002	-	9
Peter Skogert	emp.rep., dep.	2005	-	81)
Stefan Brodén	emp.rep., dep.	2007	-	81)

1) Employee deputies do not participate in decisions per capsulam.

2) In 2009 Eva-Britt Gustafsson and Bengt Larsson were directors until the Annual General Meeting and they attended the four meetings held during that period.

3) Anders Narvinger was elected to the Board of Directors at the 2009 Annual General Meeting and has been present at the five meetings and two committee meetings held thereafter.

4) Berthold Lindqvist was a board member until he passed away in December 2009.

Further information about the Board's Directors according to article 2.6 in the Code is specified on page 88.

INDEPENDENT

All directors with the exception of Johan Skoglund as President are to be considered independent in relation to the Company and all are independent in relation to the owners. Employee representatives are not independent of the company.

DUTIES AND RESPONSIBILITIES

Duties of the Board of Directors

The Board's duties deal with strategic issues such as JM's business concept, key policies, the market, finance and financial position, risks, human resources and leadership, control and efficiency, as well as decisions concerning production starts of projects, acquisition and sale of development properties and project properties.

The most important governing documents are:

• Articles of Association

• Rules of Procedure for the Board of Directors, Instructions for the Allocation of Duties between the Board and the President, and Instructions for Financial Reporting

• JM's Authorization Regulations

• JM's policies (Quality and Environmental Policy, Employee Policy, Communication Policy, Financial Policy and Purchasing Policy)
• JM's Ethical Guidelines and Guidelines for Communication and Procurement.

Newly elected directors are introduced to the company's business concept, market, policies and its systems for internal control and risk management.

Duties of the Chairman of the Board

The Chairman of JM's Board of Directors has ultimate responsibility for the company complying with the established strategic focus. In this context the Chairman has regular contact with the company's President and serves as discussion partner to the President. The Chairman's duties in general comply with the requirements of the Code.

Secretary to the Board

The company's Chief Legal Advisor is Secretary to the Board. The Chief Legal Advisor is not a member of the Board of Directors.

Board of Directors' evaluation of its own performance

The performance of the Board of Directors is evaluated every autumn. The results of the survey and conferences are provided to the Nomination Committee.

The Board's evaluation of the President

The Board of Directors evaluates the President's performance annually.

Important matters during 2009

Among other things, in 2009 the Board of Directors decided on a number of housing starts for residential projects, which have an estimated total project expense exceeding the maximum level delegated to the CEO of SEK 400 million per project. Moreover, the Board decided on the sale of two fully developed housing projects for the elderly, for which long-term leases were signed with the respective municipalities. The Board of Directors also decided to set forth proposals to the Annual General Meeting on long-term variable salary programs, which will be performancebased and share- or cash-related.

The Board of Directors also held a separate strategy meeting and adopted the strategic plan for the Company. JM's policies and guidelines were addressed at the strategy meeting and a competitor analysis was reviewed.

In January 2010 the Board decided to acquire parts of operations within the SBC Group.

The Duties of the Committees

The committees usually meet in conjunction with Board meetings or when necessary. Minutes are kept and shared with the Board of Directors and the auditors. No committees have been delegated the right of decision except for the

• Compensation Committee, which approves salaries and other terms and conditions for the Executive Management excluding the President, and the
• Audit Committee, which in consultation with the external auditors formulates the plan for the work of the external auditors

and determines how JM's central Internal Audit function should work. The Audit Committee approves remuneration and compensation to the external auditors for special assignments and initiates more in-depth initiatives in selected areas.

With the exception of the President, all Directors elected at the Annual General Meeting also sit on one or more committees. The President participates at committee meetings after notification from the chairman of the respective committee. The Chairman of the Board chairs the Compensation Committee and the Investment Committee. The Chairman of the Audit Committee was director Berthold Lindqvist until he passed away in December. He was succeeded by director Elisabet Annell. The Chief Financial Officer reports at Audit Committee meetings.

The Audit Committee

The Audit Committee was established in 2003 and currently has two directors: Elisabet Annell (chairperson) and Anders Narvinger. The committee met four times during the calendar year.

During the year the Audit Committee mainly focused on:

• Approval of remuneration and compensation to the auditors for special assignments
• Review of the short-term and long-term audit plan
• Quality assessment of internal control systems and control procedures
• Progress report and analysis of areas or projects of special interest
• Review and analysis of financial statements and interim reports
• Report and present to the Board of Directors observations noted during review sessions with auditors and management
• Initiate more intense initiatives in selected areas
• Preparation of the Corporate Governance Report and the Board of Directors' Report on Internal Control and Risk Management regarding Financial Reporting.

Compensation Committee

The Compensation Committee was established in 2003 and currently has two directors: Lars Lundquist (chairman) and Åsa Söderström Jerring. The committee held five meetings during the year.

The duties of the Compensation Committee during the year have been to:

• Prepare recommendations for salary, pension benefits and other terms and conditions for the President of the company
• Prepare recommendations relating to general principles for remuneration to all other employees, especially in terms of variable compensation
• Prepare recommendations for possible convertible and warrant programs to be submitted to the Annual General Meeting
• Approve salary and other terms and conditions for the Executive Management (excluding the President), based on Boardapproved general principles.

Investment Committee

The Investment Committee was established in 2004 and currently has three members: Lars Lundquist (chairman), Torbjörn

THE BOARD OF DIRECTORS' REPORT ON INTERNAL CONTROL AND RISK MANAGEMENT OVER FINANCIAL REPORTING

Governance Structure

in section Monitoring below.

times during the year.

project properties.

housing projects.

FINANCIAL REPORTING

The Board has ultimate responsibility for establishing an effective internal control and risk management system. The responsibility for maintaining an effective control environment and regular work with internal control and risk management is delegated to the President. Risk management is an integrated part of decisionmaking at all levels within JM and is incorporated as a natural element in JM's business processes. For a detailed description of JM's risk management procedures please refer to page 38.

Torell and Åsa Söderström Jerring. The Committee met two

The Investment Committee's duties during the year have been,

• Evaluate the strategy for scope and focus pertaining to devel-

• Prepare recommendations to purchase or sell development properties and project properties or shares and participation

• Prepare recommendations relating to investments in existing

• Prepare recommendations relating to production start of

• Prepare recommendations relating to external contractors.

The President shall ensure that the Board receives progress reports on JM's operations, including JM's financial performance, position and liquidity as well as information about the status of larger projects and other significant events. These reports shall be of such nature that the Board can make a well informed evaluation. The financial reporting that the Board receives can be seen

within the framework of JM's order of delegation, to:

rights in companies as owner of such properties.

opment properties and project properties

The Governance Structure can be seen in the diagram:

In recent years the Board of Directors has placed special emphasis on building effective control structures.

The quality of JM's processes and systems for ensuring good internal control is based on the control environment, which includes the Board's adopted rules of procedure and instructions for financial reporting. Establishing the Audit Committee the Board has facilitated closer contact with both internal and external auditors, enabling the Board and its committees to learn about the company's financial position in various ways. Consequently, the external and internal auditors meet the Audit Committee four to five times per year. In addition the external auditors meet the entire Board twice a year.

The main task of JM's central Internal Audit function is to examine the suitability of the operation and its efficiency by checking compliance with the business-critical requirements of JM's Operations System. JM's Operations System is a comprehensive process-oriented work structure with the purpose of ensuring the efficiency of JM's business processes. JM's central Internal Audit has the special task of examining the financial risks associated with larger projects. The Board ensures that JM has solid project and financial management through regular communication with internal and external auditors.

As part of the initiative to develop and standardize method and processes within the Group, the Finnish operation implemented the groupwide business system and associated processes during the year. The Norwegian operation is carrying out a similar initiative.

Control Environment

JM's core values and corporate culture comprise the basis of internal controls with respect to financial reporting. Control environment refers to both the infrastructure built for internal control and governance, as well as JM's core values. The control environment consists of the organization, channels for decisions, authorities and responsibilities, documented and communicated in normative documents such as internal policies, guidelines, manuals and codes; for example, the distribution of work between the Board on the one hand and the President on the other hand, and the other bodies that the Board establishes, instructions for approval powers, as well as accounting and reporting instructions.

Risk assessment

The Company applies a method or process for risk assessment and risk management to ensure that those risks to which the company is exposed are managed within the established frames and that the risks are handled within the framework of existing processes and systems. JM's Operations System, which describes JM's business from a process perspective with established business-critical requirements, along with procedures for control, monitoring and follow-up of projects, comprises an important element of risk management.

Control activities

The risks identified with respect to financial reporting are managed via the company's control activities, which are documented in process and procedure descriptions. The purpose of control

The decision process can be seen below:

activities is to continually improve while preventing, detecting and correcting errors and deviations.

Examples of control activities in which risk assessments are managed:

• The Operations System that documents the operation's processes and established business-critical demands
• Project reviews before initiating acquisitions, pre-construction, production and sales starts
• Business committee meetings and Group Executive Management meetings preparing for investments in properties and initiation of residential production projects. Business unit managers, staff managers and regional managers/subsidiary managers participate at these meetings (monthly)
• Forecast reviews with business unit managers (quarterly)
• Close monitoring of large projects at which the President, Chief Financial Officer, business unit manager and regional manager/ subsidiary manager participate (quarterly)
• Group management meetings in larger projects (quarterly)
• Board meetings at subsidiaries
• JM Internal Audit's review and control of the business-critical requirements and review of the economic risks in the larger projects (ongoing).

Information and communication

The Company has implemented information and communication channels to encourage completeness and accuracy in financial reporting; for example, by notifying concerned personnel about normative documents such as internal policies, guidelines, manuals and codes pertaining to financial reporting and making such documents available to them over JM's Intranet.

JM's principal normative documents are the Rules of Procedure for the Board of Directors, Instructions for the Allocation of Duties between the Board and the President, Instructions for Financial Reporting and JM's Authorization Regulations.

Other normative documents such as policies, guidelines, instructions and manuals for financial reporting are available on JM's Intranet as well as in the Operations System. The most important documents are:

• Schedule and instructions for forecasts and financial statements
• Financial statement and forecast processes
• Instructions on project management
• Instructions for purchases and sales
• Financial policy
• Controlling within JM
• Accounting principles
• Procedure descriptions.

Monitoring

The Board of Directors receives financial reports in conjunction with the interim reports. In addition to the outcome and forecast reports the Audit Committee receives financial audit reports for larger projects. In connection with the delegation rules the Board of Directors/Investment Committee receive regular acquisition and project estimates, summaries of planned and current projects, investments in and purchases/sales of properties. In addition, the Board of Directors' various committees serve an important function in follow-up of activities.

The Board follows up and reviews internal control to ensure that it works satisfactorily, in part through JM's external auditors, in part through the company's central Internal Audit function, which both operate based on a plan approved by the Board's Audit Committee. The results of the audits and proposals for any measures that need to be taken are regularly reported to the Audit Committee.

REMUNERATION TO THE BOARD OF DIRECTORS

After a recommendation from the Nomination Committee the 2009 Annual General Meeting resolved:

• that the Chairman of the Board should be paid a fee of SEK 590,000 and regular directors who are not employed by the company will be paid SEK 260,000,
• that the fee for work in the Audit Committee should be SEK 110,000 to the chairman and SEK 80,000 to the Directors, and that a fee of SEK 55,000 be paid to the respective chairs and directors of the Compensation and Investment Committees.

Recommendations for compensation guidelines for JM's senior executives will be presented as required by law at the 2010 Annual General Meeting for resolution. The Board of Directors will decide on salary, pension benefits and other remuneration for the President, and the Compensation Committee decides on such matters for the Executive Management excluding the President. Information about compensation guidelines for JM's senior executives can be found in the Board of Directors' Report on page 46. Information about compensation to the President and Executive Management can be found in note 3, pages 58–59 of Notes to the financial statements.

About 650 of JM's managers and executives, including the President and Executive Management participate in a performance-based salary system. The total salary comprises a basic and a variable component with a maximum result for the variable component that, depending on position, varies between one and seven monthly salaries. In addition to financial result, which carries the greatest weight, the variable salary component is based on individual target fulfillment and the Customer Satisfaction Index. The principle is that the basic salary combined with a normal result for the variable component should result in a market salary.

2009 CONVERTIBLE PROGRAM AND 2009 WARRANT PROGRAM

The 2009 Annual General Meeting resolved that JM should raise a debenture loan with a nominal value of a maximum of SEK 50 million by issuing a maximum of 540,000 convertible debentures, aimed at all employees in Sweden and issue a maximum of 85,000 warrants aimed at all employees outside Sweden. The purpose of the 2009 Convertible Program and 2009 Warrant program is to enhance and strengthen employees' interest in JM's operations and future financial performance through an ownership commitment. Increased employee motivation and participation in JM's operations is in the interest of the company, the employees and existing shareholders.

Upon expiry of the subscription period the loan amounts to about SEK 28 million through the issue of about 379,000 convertible debentures and the number of warrants issued is approximately 20,000. In accordance with IAS 32 the liability and equity

components of the convertible debenture loan are reported separately, which means that the debenture loan is reported in the balance sheet as a liability initially with the nominal amount excluding the equity component. Most of the convertible debenture loan was settled against cash in July 2009.

Each convertible debenture and warrant may be converted into one share, at a price of SEK 74. Conversion or exercise may take place from June 1, 2011, through May 24, 2013, with the exclusion of the period January 1 until the record date for dividends each year.

Through conversion of convertibles and subscription for warrants, JM's share capital could increase by a maximum of SEK 400,000, through the issue of a maximum of 400,000 shares, each with a quota value of SEK 1. This corresponds with dilution of about 0.5 percent of shares and votes in the company.

The convertible debenture loan falls due for payment on June 17, 2013, insofar as conversion has not already been undertaken.

MANAGEMENT AND CORPORATE STRUCTURE

ORDER OF DELEGATION—PRESIDENT'S RIGHT OF DECISION

The Board has delegated to the President the right of decision for:

• purchases and sales of development and project properties up to SEK 100 million
• investments in existing project property up to SEK 400 million for implementation of housing projects, or SEK 200 million for implementation of office projects
• production start of housing project, up to a maximum project cost of SEK 400 million excluding the purchase price for the property
• signing of external contracting agreements up to SEK 400 million
• raising of new loans that are not linked to acquisition of a property, up to a total of SEK 400 million per year for loans with a shorter maturity than one year, up to a total of SEK 250 million per year for loans with maturity longer than one year.

In other cases the Board decides. These amounts are chosen to meet the Board's needs to exercise control and management's need of freedom of action. The President has the right to further delegate some of the above decision rights.

Matters requiring decisions are prepared in part by the Business Committee, consisting of business unit and regional managers from the Group, as well as by the Group Executive Management.

JM's operational organization can be seen in the above diagram.

EXECUTIVE MANAGEMENT

JM's business is operationally divided into six business units. Each business unit manager reports directly to the President. Executive Management comprises the President, all heads of business units and staff heads, a total of eight people, and meets at least once a month.

Management responsibility includes always working to ensure compliance with guidelines issued by the Board and the President. External financial reporting takes place in five business segments.

GOVERNANCE AND REPORT STRUCTURE

At JM, a large number of projects are in production at any given time. It is not unusual for a project to involve more than 100 people with an estimated order value of more than SEK 100 million. Every project is run by a project manager who is responsible for the project's revenues and expenses. The project manager reports to the regional manager who is directly subordinate to the business unit manager. All these people have profit responsibility. The business unit manager is responsible for deciding the revenue level in the projects.

Decisions to begin work on a project are made by business unit management or Executive Management; for major projects such decisions are made by the Board. Follow-up of sold and reserved residential units takes place on a weekly basis, with reporting to regional manager, business unit manager and the President. Complete analyses and reconciliation of each project's revenues and expenses are performed every quarter.

More intense monitoring routines have been introduced for large projects. The business unit manager and the regional manager/head of subsidiary present quarterly reports to the President and CFO. Assessment data include the financial history of the project, future anticipated revenues and expenses and the current sales and reservations situation. The largest projects have special steering groups and are audited by JM's Internal Audit function and presented in the Audit Committee.

AUDITORS' REPORT

This report has not been examined by the company's auditors.

Stockholm February 25, 2010

The Board of Directors

88 board of directors and auditors

Top row from left to right: Lars Lundquist, Jonatan Sundelin, Johan Skoglund, Johan Wegin, Elisabet Annell. Bottom row from left to right: Torbjörn Torell, Anders Narvinger, Åsa Söderström Jerring, Peter Skogert, Stefan Brodén, Berthold Lindqvist.

Lars Lundquist

Chairman of the Board, Chairman of the Compensation Committee and the Investment Committee. Appointed to the Board: 2005 Shares in JM: 85,000

Age: 62

Education: MSc, Stockholm School of Economics; MBA, University of Wisconsin.

Work experience: 32 years at various banks, brokerage firms and insurance companies.

Other significant appointments: Chairman of the Board of Vasakronan, Intrum Justitia AB and Försäkrings AB ERIKA. Board member of Sjätte AP-fonden, as well as Board member and treasurer of Hjärt-Lungfonden.

Independent: The director is considered to be independent in relation to the Company and its management as well as major shareholders in the Company.

Elisabet Annell

Board member and member of the Audit Committee (Chairperson of the Audit Committee since January 2010). Appointed to the Board: 2002 Shares in JM: 2,070

Age: 64

Education: MA, Stockholm University.

Work experience: 14 years at KPMG as an authorized public accountant and corporate finance consultant, 11 years as VP and CEO of three different service companies: MGruppen, Tönnerviksgruppen, and Sifo Group; 6 years as CEO and strategic consultant at SMG and 5 years as President and CEO of Univero Group.

Other significant appointments: Board member of Livförsäkrings AB Skandia, Upplands Motor AB, Swedish Civil Aviation Administration, Öresundsbrokonsortiet, Knightec AB, STF Ingenjörsutbildning AB and Mercuri International AB.

Independent: The director is considered to be independent.

Berthold Lindqvist

Berthold Lindqvist was a Board member from the 2001 Annual General Meeting until he passed away in December 2009.

Anders Narvinger

Board member and member of the Audit Committee. Appointed to the Board: 2009 Shares in JM: 5,000

Age: 61

Education: M.Sc in Engineering from Lund Institute of Technology; MSc in Economics from Uppsala University.

Work experience: Previously active within the ABB Group, including as CEO and President of ABB Sverige.

Other significant appointments: CEO of Teknikföretagen since 2002. Chairman of the Board of companies such as Alfa Laval AB, Trelleborg AB, and Coor Service Management AB. Board member of Volvo Car Corporation and Pernod Ricard SA.

Independent: The director is considered to be independent.

Johan Skoglund

CEO and President and Board member. Appointed to the Board: 2003 Shares in JM: 23,400 Convertibles: SEK 3,761,838

Age: 47

Education: M.Sc.Eng, Royal Institute of Technology, Stockholm; Master of Science Program at Stockholm School of Economics.

Work experience: 23 years at JM in various positions such as site engineer, project manager, regional manager, business unit manager and President.

Other significant appointments: Board member of AB Bostadsgaranti, Försäkrings AB Bostadsgaranti, Sveriges Byggindustrier and Mentor Sverige.

Independent: The director is considered to be dependent in his capacity as President and CEO.

Åsa Söderström Jerring

Board member and member of the Investment Committee and Compensation Committee. Appointed to the Board: 2007 Shares in JM: 5,000

Age: 53 Education: MSc, Stockholm University

Work experience: 25 years of experience from the building and real estate industry in various positions such as Communications Manager at NCC Bygg, President at Ballast Väst and President at SWECO Theorells.

Other significant appointments: Board member of Geveko AB, Rejlers AB, Comfort-kedjan AB, ELU Konsult AB, Arkitekterna Krook & Tjäder AB, and San Sac AB. Chairperson of the Construction Industry's Ethics Council and Förnyelse i anläggningssektorn (FIA).

Independent: The director is considered to be independent.

Torbjörn Torell

Board member and member of the Investment Committee. Appointed to the Board: 2004 Shares in JM: 5,000

Age: 54

Education: M.Sc in Engineering, Royal Institute of Technology; management programs, Stockholm School of Economics.

Work experience: President and CEO as well as Board member of Scandiaconsult AB (publ.) for 6 years, CEO of Åke Larson Byggare for 3 years, as well as 13 years at the Skanska Group in a variety of executive positions. Chairman of the Board of Arsenalen AB, Point Gruppen AB. Board member for Carl Bro AS.

Other significant appointments: CEO and President of Bravida AB since the autumn of 2004.

Independent: The director is considered to be independent.

EMPLOYEE REPRESENTATIVES

Jonatan Sundelin Born 1970. Concrete worker. Member of the Board since 2004. Shares in JM: 0 Convertibles: 0

Johan Wegin

Born 1965. Construction engineer. Member of the Board since 2002. Shares in JM: 0 Convertibles: SEK 352,018

Peter Skogert

Born 1973. Concrete worker. Deputy member of the Board since 2005. Shares in JM: 0 Convertibles: SEK 123,614

Stefan Brodén

Born: 1952. Network engineer. Deputy member of the Board since 2007. Shares in JM: 537 Convertibles: SEK 39,608

SECRETARY OF THE BOARD

Urban Lilja

Born 1952, Chief Legal Advisor, JM AB Secretary to the Board of directors since 1996. Shares in JM: 13,350 Convertibles: SEK 2,282,196

AUDITORS

Ernst & Young AB

Ingemar Rindstig Authorized public accountant Jonas Svensson Authorized public accountant Ernst & Young AB were re-elected to serve as auditors of JM AB at the Annual General Meeting in April 2008.

Shareholdings pertain to personal holdings or a related physical or legal person's holdings of JM AB shares and other financial instruments, as of February 28, 2010.

Top row from left to right: Johan Skoglund, Claes Magnus Åkesson, Helene Hasselskog, Sten Hamberg, Bottom row from left to right: Urban Lilja, Sören Bergström, Zdravko Markovski, Lennart Henriz.

EXECUTIVE MANAGEMENT

Johan Skoglund

CEO and President JM employee since: 1986 Member of Executive Management: 2000

Shares in JM: 23,400

Convertibles: SEK 3,761,838

Age: 47 years. M. Sc.Eng, Royal Institute of Technology, Stockholm 1986, and Master of Science Program, Stockholm School of Economics, 1998.

Former positions at JM: 16 years at JM AB in various positions such as site engineer, project manager, regional manager and business unit manager. President and CEO since Nov. 1, 2002.

Board member of AB Bostadsgaranti, Försäkrings AB Bostadsgaranti, Sveriges Byggnadsindustrier and Mentor Sverige.

Sören Bergström

Head of JM Residential Sweden business unit and Director of Purchasing JM employee since: 1988 Member of Executive Management: 2001

Shares in JM: 409

Convertibles: SEK 2,349,394

Age: 53 years. M. Sc.Eng, Royal Institute of Technology. Master of Science Program, Stockholm School of Economics 1996. Executive Management Program, Stockholm School of Economics 2001. Former positions at JM: project manager, President of three different subsidiaries and regional manager. Head of JM Production business unit 02–06. Head of JM Residential Sweden business unit 07–.

Board member of JM Danmark A/S, JM Construction S.A., JM Suomi Oy, Seniorgården AB and AB Borätt.

Sten Hamberg

Business unit manager JM Norway as well as JM Denmark, Finland and Belgium JM employee since: 1980 Member of Executive Management: 1999 Shares in JM: 18,455

Convertibles: SEK 2,614,381 Age: 59 years. LL.B. Uppsala University 1976.

Former positions at JM: In-house counsel, President AB Borätt and Seniorgården AB. Business unit manager Business Development /Properties. Business unit manager JM Residential Sweden 05–06 and JM Business Development 07–08. Business unit manager JM Norway as well as JM Denmark, Finland and Belgium Nov 09–. Chairman of the Board of JM Byggholt AS, JM Suomi Oy and JM Danmark A/S.

Helene Hasselskog

Director Human Resources JM employee since: 2006 Member of Executive Management: 2006 Shares in JM: 245

Convertibles: SEK 2,832,534

Age: 41 years. BA, Human Resource Development and Labor Relations, Stockholm University 1994. Human Resources Manager, Posten Brev 97–98, Human Resources Manager, Observer Sverige AB 98–02, Director of Human Resources, Observer AB 02–05.

Lennart Henriz

Director Operations Development (Quality and Environment/IT) JM employee since: 1978 Member of Executive Management: 1999 Shares in JM: 23,359, including 12,500 in

endowment insurance Convertibles: SEK 2,832,534

Age: 57 years. M. Sc.Eng, Royal Institute of Technology 1978. Former positions at JM: VP and regional manager AB Projektgaranti, Quality and Environment Manager. Operations

Urban Lilja

Development 00–.

Chief Legal Advisor and Secretary to the Board JM employee since: 1996

Member of Executive Management: 1996 Shares in JM: 13,350

Convertibles: SEK 2,832,534

Age: 57 years. LL.B., Lund University 1978. Articled clerk Borås district court, lawyer Friman & Carlander Advokatbyrå, company lawyer Celsius Industrier AB and Akzo Nobel AB.

Board member of JM Entreprenad AB.

Zdravko Markovski

Business unit manager JM Residential Stockholm, JM Production and JM Property Development, as well as head of Marketing Communications and Business Development JM employee since: 1987 Member of Executive Management: 2002 Shares in JM: 8,294

Convertibles: SEK 2,282,196 Age: 45 years. M. Sc.Eng, Royal Institute of Technology 1987.

Former positions at JM: Project manager, regional manager and Head of JM Residential business unit.

Chairman of the Board of AB Borätt, Seniorgården AB and JM Entreprenad AB.

Claes Magnus Åkesson

Chief Financial Officer JM employee since: 1998 Member of Executive Management: 1998

Shares in JM: 50,000, including 48,000 in endowment insurance Convertibles: SEK 2,832,534

Age: 50 years. MSc, Stockholm School of Economics, 1984. Advanced management programme, INSEAD, France.

Ericsson Group 87–98: senior controller Asia 94–96, head of finance and treasury Malaysia 96–97 and regional controller Asia 97–98.

Board member of JM Byggholt AS and JM Construction S.A.

OTHER SENIOR EXECUTIVES

Jonas Håkansson, South Region Per Johansson, Marketing Residential Stockholm

Mats Karlsson, West Region

Sofia Ljungdahl, Stockholm North Region Mikael Matts, East Region

Per-Anders Olsson, Malmö Region

Pär Vennerström, Stockholm South Region Anders Wimmerstedt, Production

Residential Stockholm Mikael Åslund, Stockholm City Region

Lars-Olof Höglund, Property Development Fredric Kastevik, JM Entreprenad AB

Birgitta Seeman, Seniorgården AB and AB Borätt

Jonny Änges, JM Stombyggnad AB and JM Inredning i Stockholm AB

Magnus Berg, JM Byggholt AS, Norway Christopher Lee, JM Construction S.A., Belgium Lars Svärd, Acting head of JM Suomi OY,

Finland Anders Wahrer, JM Danmark A/S, Denmark

Shareholdings as of February 28, 2010.

GOOD SHARE PRICE TREND

SHARE CAPITAL

JM shares are listed on the NASDAQ OMX Stockholm, Mid Cap segment. Share capital amounts to SEK 83.4m, represented by 83.4 million shares, each with a par value of SEK 1 and equal voting rights. Each trading block consists of 200 shares.

SHAREHOLDERS' OBJECTIVE

JM's shareholders will receive a higher total return, total of dividend and increased value, than shareholders in companies with a similar risk profile and business activities.

SHARE PRICE TREND AND RETURN

The JM share has been included in the SX252010 Household Durables Index of the NASDAQ OMX Stockholm since 2009. In 2009 JM's share price rose 186 percent, compared with an increase of 113 percent for the SX252010, and an increase of 73 percent for the SX201030, another relevant comparative index for JM. The general index on NASDAQ OMX Stockholm Stock Exchange, OMX Stockholm_PI, rose 47 percent in 2009. The highest listed price for the JM Share during the year was SEK 129.50 on December 7 and the lowest was SEK 33.40 on March 9. Dividend yield (proposed dividend in relation to the market price at year-end) was 2.0 percent (0.0). Total return in 2009 was 186 percent (–60).

Total return, %	2009	Average per year 2005–2009
JM	186	59
NASDAQ OMX Stockholm	52	15

Total return JM, 2005–2009	%	Index
2009	186	356
2008	– 60	125
2007	– 16	311
2006	94	371
2005	91	191
Jan 1, 2005		100
Average, 5 years	59

TRADING AND MARKET CAPITALIZATION

JM shares were traded for a value of SEK 11.3bn (12.0) in 2009. Average daily trading was about SEK 45m (47). The turnover rate (the liquidity of the share) was 198 percent (167) during the year compared with an average for the entire stock exchange of 119 percent (152). The company's market capitalization amounted to SEK 10.2bn (3.6) at year-end.

OWNERSHIP STRUCTURE

The number of shareholders as of December 31, 2009 was 12,890 (12,659). The ten largest Swedish shareholders accounted for 45.2 percent (45.0) of capital and foreign shareholders for 24.5 percent (27.3).

DIVIDEND POLICY

Over time, the dividend should reflect the earnings trend in total operating activities. The average dividend over a business cycle should correspond to 50 percent of consolidated profit after tax. Capital gains from property sales are a natural part of JM's project development operations, and are therefore included in the calculation of dividends. The proposed dividend for 2009 amounts to SEK 2.50 (0) per share.

Transfer to shareholders, SEKm		Dividend Redemption	Total
2005	196	966	1,162
2006	247	1,002	1,249
2007	415	1,013	1,428
2008	489	992	1,481
2009	-	-	-
Total	1,347	3,973	5,320

Shareholders as of December 31, 2009	Percent of shares
AMF Försäkring och Fonder	9.3
Swedbank Robur funds	9.1
AFA Försäkringar	6.0
SEB funds and Gamla Livförsäkrings AB SEB Trygg Liv	5.7
Nordea funds	3.5
Fjärde AP-fonden	3.0
Handelsbanken funds and SPP Livförsäkrings AB	2.9
Folksam—KPA—Förenade Liv	2.1
Länsförsäkringar funds	1.9
Skandia funds	1.7
Enter funds	1.3
Första AP-fonden	1.0
Lannebo funds	1.0
Foreign shareholders	24.5
Other shareholders	27.0
Total	100.0

Number of shareholders as of Dec 31, 2009: 12,890 Number of shares as of Dec 31, 2009: 83,401,883

SEK per share	2009	2008	2007	2006	2005
Share price as of Dec 31	123	43	132.50	166	88
Highest/lowest price during the year	129.50 / 33.40	152/26.30	264/107.25	168.50/87.50	90/46
Dividend yield as of Dec 31 (%)	2.0	0	4.2	2.7	2.8
Market capitalization as of Dec 31 (SEKm)	10,236	3,578	11,777	15,320	8,686
Earnings per share, basic and diluted	4.60	9.50	18.30	16.40	9.30
Development properties
Market value	83	88	91	77	46
Carrying amount	60	68	59	47	30
Project properties
Market value	7	8	12	12	15
Carrying amount	7	7	9	9	12
Shareholders' equity (reported)	44	39	44	39	34
Dividend	2.50 1)	0	5.50	4.50	2.50
Dividend in % of earnings per share	54	0	30	27	27
P/E ratio as of Dec 31	27	5	7	10	10
Number of shares as of Dec 31	83,216,883 2)	83,216,883 2)	88,879,308 3)	92,289,764	98,705,520
Average number of shares, before dilution	83,216,883	85,968,011	91,076,274	95,453,698	105,390,727
Average number of shares, after dilution	84,376,081	85,991,380	91,090,084	95,453,698	105,390,727

1) Proposed by the Board.

2) Excluding 185,000 repurchased shares.

3) Excluding 35,000 repurchased shares.

OWNERSHIP STRUCTURE As of DEC 31, 2009

Size of holding	Number of shareholders	Percent of all shareholders	Total number of shares owned	Percent of share capital
1–500	8,513	66.0	1,613,302	1.9
501–1,000	2,101	16.3	1,777,380	2.1
1,001–5,000	1,657	12.9	3,774,231	4.5
5,001–20,000	335	2.6	3,421,565	4.1
20,001–100,000	151	1.2	7,130,983	8.6
100,001–	133	1.0	65,684,422	78.8
Total	12,890	100.0	83,401,883	100.0

Year	Share split Redemption of shares, SEKm	Number of shares	Par value/ share	Share capital SEKm
2005	– 13.5	24,676,380	SEK 4	98.7
2006	– 6.4	23,072,441	SEK 4	92.3
2006	4:1	92,289,764	SEK 1	92.3
2007	– 3.4	88,914,308	SEK 1	88.9
2008	– 5.5	83,401,883	SEK 1	83.4
2009		83,401,883	SEK 1	83.4

Welcome to JM's Annual General Meeting

Shareholders in JM AB are hereby invited to attend the Annual General Meeting to be held at 4 p.m. on Wednesday, April 28, 2010, at JM's head office, Gustav III:s boulevard 64 in Solna, Sweden.

NOTIFICATION

Shareholders who wish to participate at the meeting must be entered in the register of shareholders maintained by Euroclear Sweden AB by Thursday, April 22, 2010, and must have informed the Company of their intention to participate by 4:00 p.m. on Thursday, April 22, 2010, using one of the following channels:

Mail:	JM AB, SE-169 82 Stockholm
Telephone:	+46 (0) 8 782 87 00
Fax:	+46 (0) 8 782 86 12
E-mail:	monica.charron@jm.se
JM AB's website:	www.jm.se

In order to be entitled to participate at the Meeting, shareholders whose shares are registered in the name of a nominee must request that their shares be temporarily registered in their own name in the register of shareholders by Thursday, April 22, 2010.

Admission cards to the Annual General Meeting will be sent out.

DIVIDEND

The Board of Directors proposes that a dividend of SEK 2.50 per share be paid to shareholders. The proposed record date for the dividend is Monday, May 3, 2010. If the Annual General Meeting resolves to adopt the recommendation the dividend will be sent by Euroclear Sweden AB on Thursday, May 6, 2010.

FINANCIAL CALENDAR

April 28, 2010	Interim report January–March 2010
	Annual General Meeting
August 23, 2010	Interim report January–June 2010
October 28, 2010	Interim report January–September 2010
February 9, 2011	Year-end report 2010
April 28, 2011	Interim report January–March 2011
	Annual General Meeting 2011

The reports are available in Swedish and English and may be ordered from JM AB, Finance and Treasury, Tel. +46 (0) 8 782 87 00 or via www.jm.se/investors.

a selection of development properties and project properties

Development properties were chosen based on the size of the projects and the time aspect—they have been or will be started in the next few years.

	DEVELOPMENT PROPERTIES—RESIDENTIAL
				sweden
Country	Property/project Municipality Location type	Number of residential units in housing projects not yet started approx.	Development period	Current rentable space Dec 2009 m2	Rental income 2009 SEKm	Form of tenure	Planning process Planning phase Production
Sweden	Långbro	320	2000–2013	300	0.1		Detailed plan
	Stockholm					Tenant-owners
	Älvsjö					association	Production start 2000
Sweden	Liljeholmskajen	1,400	2001–2016	1,000	2.1		Detailed plan—800 units
	Stockholm					Tenant-owners
	Årstadal/Liljeholmen					association	Production start 2001
Sweden	Liljeholmen	280	2013–2015	2,800	3.5		Detailed plan 2013
	Stockholm					Tenant-owners
	Liljeholmen/Gröndal					association	Production start 2013
Sweden	Sandhamn Farsta	280	2011–2014	5,000	2.1	Tenant-owners	Detailed plan 2009
	Stockholm					association	Production start 2010
Sweden	Telefonplan	210	2010–2012				Detailed plan 2010
	Stockholm					Tenant-owners
	Telefonplan					association	Production start 2010
Sweden	Bolinder Strand	200	2001–2013				Detailed plan—100 units
	Kallhäll					Tenant-owners
	Järfälla					association	Production start 2002
Sweden	Norra Frösunda	250	2001–2013				Detailed plan
	Solna					Tenant-owners
	Frösundavik					association	Production start 2003
Sweden	Järvastaden	770	2007–2020			Tenant-owners	Detailed plan
	Solna/Sundbyberg					association
	Solna and Sundbyberg					Freehold apartments	Production start 2007
Sweden	Dalénum	750	2007–2018				Detailed plan 2009
	Lidingö					Tenant-owners
	Close to water					association	Production start 2010
Sweden	Kvarnholmen	970	2009–2020	approx. 22,500	16.2		Detailed plan 2009
	Nacka					Tenant-owners
	Close to water					association	Production start 2009
Sweden	Charlottendal/Farstadal Värmdö	700	2002–2016			Tenant-owners association	Detailed plan—100 units
	Gustavsberg					Freehold apartments	Production start 2003
Sweden	Östermalm	330	2005–2014				Detailed plan
	Västerås					Tenant-owners
	City					association	Production start 2005
Sweden	Bällstaberg	210	2001–2015				Detailed plan—50 units
	Vallentuna					Tenant-owners
	Bällstabergsvägen					association	Production start 2002
Sweden	Industristaden	520	2002–2014	approx. 14,000	2.9		Detailed plan—100 units
	Uppsala					Tenant-owners
	Kungsängen					association	Production start 2003

sweden (continued )
---------------------------	--

Country	Property/project Municipality Location type	Number of residential units in housing projects not yet started approx.	Development period	Current rentable space Dec 2009 m2	Rental income 2009 SEKm	Form of tenure	Planning process Planning phase Production
Sweden	Librobäck	300	2010–2012	8,600	5.3		Detailed plan 2011
	Uppsala					Tenant-owners
	Yttre Luthagen					association	Production start 2012
Sweden	Kviberg	450	2003–2015				Detailed plan 2009
	Göteborg					Tenant-owners
	By the river Säveån					association	Production start 2010
Sweden	Västra Eriksberg	280	2009–2013				Detailed plan
	Göteborg					Tenant-owners
	Norra Älvstranden					association	Production start 2009
Sweden	Juvel Kvarnen	380	2006–2013				Detailed plan 2009
	Göteborg					Tenant-owners
	Norra Älvstranden					association	Production start 2006
Sweden	Kolla	200	2011–2015			Tenant-owners	Detailed plan 2010
	Kungsbacka					association
	Central					Freehold apartments	Production start 2011
Sweden	Dockan	320	2003–2016				Detailed plan—110 units
	Malmö					Tenant-owners
	Västra Hamnen					association	Production start 2003
Sweden	Lomma	690	2003–2017			Tenant-owners	Detailed plan
	Lomma					association
	Lomma Hamn					Freehold apartments	Production start 2004
Sweden	Vallkärratorn	210	2005–2016				Detailed plan—66 units
	Lund
	Stångby					Freehold apartments	Production start 2005
Sweden	Kugghjulet	475	2013–2020	17,500	8.5		Detailed plan 2013
	Lund					Tenant-owners
	Västra Lund					association	Production start 2013
Sweden	Raffinaderiet	285	2009–2015	4,400	3.0		Detailed plan 2009
	Lund					Tenant-owners
	By rail station					association	Production start 2009
Total		10,780
	Other building rights, not specified	10,120
	Total building rights, Sweden	20,900

Country	Property/project Municipality Location type	Number of residential units in housing projects not yet started approx.	Development period	Current rentable space Dec 2009 m2	Rental income 2009 SEKm	Form of tenure	Planning process Planning phase Production
Norway	Stongafjellet	500	2005–2015				Control plan
	Askøj Bergen
	Close to nature, ocean view					Freehold apartments	Production start 2005
Norway	Koltveit	320	2012–2018				Control planning
	Fjell, Bergen
	Close to water					Freehold apartments	Production start 2012
Denmark	Enghave Brygge	485	2010–2016				Local plan 2010
	Copenhagen
	By the harbor					Freehold apartments	Production start 2011
Belgium	Merbraine	200	2010–2016				Detailed plan1) 2010
	Braine l´Alleud
	Park setting					Freehold apartments	Production start 2010
Total		1,505
Other building rights, not specified		5,495
	Total building rights, international	7,000

1 ) Concept does not exist in Belgium.

project properties

Rental space, m2 (including garage)	Residential properties (leasehold)	Properties under development	Fully developed commercial properties
Greater Stockholm	0	57,668	427
Rest of Sweden	0	4,368	0
International	0	0	2,093
Total	0	62,036	2,520

RENTABLE SPACE, BY CATEGORY

PROPERTIES UNDER DEVELOPMENT

No.	Property	Age	Total rentable space	Rentable space, by category		Rental income 2009	Rental income by category	Development
	Municipality	Construction year		Hotel	Housing		Hotel/Offices	Description
	Address	Renovation year		Office	Other		Retail	Major tenants
	Description			Retail	Garage		Housing
							Other/Garage
			m2	m2	m2	SEKm	%
1	Tulpansvampen 2	2009–2010	4,368	0	0	0.0	0	Assisted living
	Norrtälje			0	4,368		0	Norrtälje Municipality
	Asteroidvägen			0	0		0
	Assisted living						100
2	Kallhäll 1:22	1907	16,021	0	0	8.7	32	Development of offices
	Järfälla			2,794	12,497		0	and industry
	Fabriksvägen			0	730		0	Haglöfs, Friskis & Svettis
	Light industry						68	and others
3	Dalénum	1912–1960	41,647	0	0	35.5	36	Development of offices
	Lidingö	2009		23,022	18,625		0	AGA
	Södra Kungsvägen			0	0		0	Bring
	Offices, etc.						64	Recco and others

FULLY DEVELOPED commercial PROPERTIES

No.	Property	Age	Tax year 2009	Total rentable space	Rentable space, by category		Income 2009	Rental income by category	Major tenants
	Municipality	Construction year	Tax value		Hotel	Housing	Rental income	Hotel/Offices
	Address	Renovation year			Office	Other		Retail
	Description				Retail	Garage		Housing
								Other/Garage
			SEKm	m2	m2	m2	SEKm	%
4	Yxlö 3:51	1984	1.2	427	0	0	0.5	0	Internal used by JM
	Nynäshamn	2009			0	427		0
	Ådudden				0	0		0
	Conference facility							100
5	Beitostølen	1990	2.9	90	0	90	0.0	0	Internal used by JM
	Beitostølen, Norway				0	0		0
	Øystre Slidre				0	0		100
	Cabins/lodge							0
6	Grefsen (50%)	1978	29.8	2,003	0	0	1.9	100	Steinar Hansen AS
	Bærum, Norway	1986			2,003	0		0	Danmon Norge AS
	Bærumsveien 473				0	0		0	Tour & Andersson
	Office							0	Micro Maltic

HEAD OFFICE AND STOCKHOLM OFFICE

JM AB

SE-169 82 Stockholm Visiting address: Gustav III:s boulevard 64, Solna Tel. +46 8 782 87 00, fax +46 8 782 86 00 Internet: www.jm.se

REGIONAL AND LOCAL OFFICES

East Region Uppsala (regional office) Sylveniusgatan 2 Box 1334, SE-751 43 Uppsala Tel. +46 18 66 03 00, fax +46 18 66 03 10

Västerås Kopparbergsvägen 8, SE-722 13 Västerås Tel. +46 21 81 20 00, fax +46 21 81 20 10

Örebro Vasastrand 11, SE-703 54 Örebro Tel. +46 19 764 15 10, fax +46 19 764 15 15

West Region Göteborg (regional office) Gårdatorget 2, SE-412 50 Göteborg Tel. +46 31 703 57 00, fax +46 31 335 88 70

Jönköping Tegnérgatan 5, SE-553 34 Jönköping Tel. +46 36 585 10 00, fax +46 36 12 03 66

Linköping Brigadgatan 24, SE-587 58 Linköping Tel. +46 13 37 14 00, fax +46 13 37 14 09 Malmö Region and South Region Malmö (regional office) Box 327, SE-201 23 Malmö Visiting address: Jörgen Kocksgatan 9

Halmstad Brogatan 1, SE-302 43 Halmstad Tel. +46 35 299 42 50, fax +46 35 10 67 45

Tel. +46 40 16 56 00, fax +46 40 16 56 01

SUBSIDIARIES IN SWEDEN

AB Borätt Box 6048, SE-171 06 Solna Visiting address: Landsvägen 50 A, Sundbyberg Tel. +46 8 626 66 30, fax +46 8 626 98 20 www.boratt.se

Seniorgården AB Box 6048, SE-171 06 Solna Visiting address: Landsvägen 50 A, Sundbyberg Tel. +46 8 626 66 30, fax +46 8 626 98 20 www.seniorgarden.se

JM Entreprenad AB SE-169 82 Stockholm Visiting address: Strandbergsgatan 57 Tel. +46 8 782 87 00, fax +46 8 782 86 01 www.jm-entreprenad.se

SUBSIDIARIES OUTSIDE SWEDEN

Norway

JM Byggholt AS Bærumsveien 473, Rud Postboks 33 N-1306 Bærum Postterminal Tel. +47 67 17 60 00, fax +47 67 13 61 60 www.jmbyggholt.no

Denmark

JM Danmark A/S Nyropsgade 14 DK-1602 København V Tel. +45 33 45 70 00, fax +45 33 45 70 70 www.jmdanmark.dk

Finland

JM Suomi Oy Sinimäentie 8B FI-02630 Espoo Tel. +358 9 4730 2610, fax +358 9 4730 2616 www.jmsuomi.fi

Belgium

JM Avenue Louise 287 B-1050 Brussels Tel. +32 2 646 11 12, fax +32 2 646 96 26 www.jmconstruction.be

Production: JM, Holy Diver, Anette Andersson and Lindermyr Produktion Text: JM

Photos and illustrations: Torbjörn Bergkvist, Cadwalk, Dark Arkitekter A/S, Elitfönster, Sune Fridell, Richard Hammarskiöld, Rikkard Häggbom, Mathias Landefjord, Kjell Arne Larsson, Martin Löf, Per Magnus Persson, Staffan Trägårdh and JM Repro and printing: Ljungbergs Tryckeri AB Paper: Galerie Art Silk 150g /300g

JM AB (publ) Mailing address SE-169 82 Stockholm Visiting address Gustav III:s boulevard 64, Solna Telephone +46 (0) 8 782 87 00 Telefax +46 (0) 8 782 86 00 Company reg.no. 556045-2103 Website www.jm.se