JM — Annual Report 2010

Mar 21, 2011

ANNUAL REPORT 2010

CONTENTS

OPERATIONS

• 1 THE YEAR IN BRIEF
• 2 CEO'S COMMENTS
• 4 BUSINESS CONCEPT, GOALS AND STRATEGIES
• 6 JM's CORE BUSINESS
• 8 MARKET OVERVIEW
• 17 customers
• 20 RESIDENTIAL BUILDING RIGHTS
• 22 PROJECT PROPERTIES
• 23 BUSINESS SEGMENTS
• 28 SUSTAINABLE URBAN PLANNING
• 34 EMPLOYEES
• 38 RISKS AND 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 NOTES TO THE FINANCIAL STATEMENTS
• PARENT COMPANY: 71 INCOME STATEMENT AND

• CASH FLOW STATEMENT

• 73 NOTES TO THE FINANCIAL STATEMENTS

• 76 FIVE-YEAR OVERVIEW—GROUP
• 78 QUARTERLY OVERVIEW— GROUP
• 79 QUARTERLY OVERVIEW—
• BUSINESS SEGMENTS 80 ifric 15
• 82 PROPOSED DISPOSITION OF EARNINGS
• 83 AUDITorS' REPORT
• 84 DEFINITIONS AND GLOSSARY

SHAREHOLDER information

• 85 CORPORATE GOVERNANCE REPORT
• 92 BOARD OF DIRECTORS AND AUDITORS
• 93 EXECUTIVE management
• 94 THE JM SHARE
• 96 NOTICE OF ANNUAL GENERAL MEETING
• and financial calendar
• 97 JM's PROPERTIES 100 ADDRESSES

Cover photo: JM's offering is summarized by the "Smarta 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.

Norway Finland

JM is one of the leading developers 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 2,100 employees.

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

Business con cept

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.

Objective for share holder value

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

72 BALANCE SHEET 73 CHANGES IN EQUITY

Good sale s and high level of hou sing start s

• • Revenues amounted to SEK 9,136m (9,620), including a negative impact on revenue of SEK –138m (842) due to restatement according to IFRIC 15. Revenue according to segment reporting, based on percentage of completion method, shows an increase of SEK 496m (–3,451)
• • The number of residential units sold totaled 3,276 (3,291) and housing starts increased to 3,404 (2,150)
• • Profit before tax improved to SEK 840m (529) including a negative impact on revenue of SEK –62m (–18) due to restatement according to IFRIC 15. Profit after tax improved to SEK 594m (365). The operating margin increased to 9.9 percent (6.7)
• • Return on equity for the year rose to 15.7 percent (10.6). Earnings per share increased to SEK 7.10 (4.40)
• • Consolidated cash flow including net investment in properties was SEK 42m (1,124) including cash paid for the Dalénum acquisition, Stockholm, SEK –719m
• • The Board of Directors proposes a dividend of SEK 4.50 (2.50) for 2010.

INCOME BY BUSINESS SEGMENT, SEKm

SEKm	2010	20091)	20082)
Income	9,136	9,620	12,229
Operating profit	907	646	1,083
Profit before tax	840	529	1,052
Cash flow from operating activities	42	1,124	101
Operating margin (%)	9.9	6.7	8.9
Return on equity (%)	15.7	10.6	22.9
Equity/assets ratio (%)	40	37	32
Earnings per share (SEK)	7.10	4.40	9.50
Number residential units sold	3,276	3,291	1,871
Number of housing starts	3,404	2,150	1,829

1) Comparative figures were restated due to the changed accounting principles regarding revenue recognition in JM International. As in the Swedish business, segment reporting and project management of JM's foreign operations will continue to be carried out based on IAS 11, percentage of completion method. For more information about IFRIC 15, please see the accounting principles on pages 54–57 and tables that show the effects of restatement on pages 80–81.

2) Financial year 2008 is not restated according to IFRIC 15.

For definitions, see page 84.

OPERATING PROFIT BY BUSINESS SEGMENT, SEKm

WE INCREASE CAPACI TY TO MEET STRONGER DEMAND FOR JM'S HOMES

In 2010 we saw a strengthening of the economy in our markets compared with the weak level of the past two years. For JM this improvement means a turnaround from low production volumes and we are now optimistic about the current trend.

Today we have good demand and sales in our residential projects in Stockholm, as well as elsewhere in Sweden and in Norway. We have seen some improvement of demand in Denmark, Finland and Belgium.

JM had a total of 3,400 housing starts in 2010 and provided that the market continues to develop favorably, we would like to grow back to the level of about 4,000 housing starts per year. We are gradually increasing our capacity and the big challenge, especially in the Stockholm region, is to recruit employees to be able to start more projects.

We have seen record-high population growth in metropolitan regions in Sweden, households are enjoying a better economy, the labor market continues to improve and interest rates are historically low. The population in the Oslo region also surged, as did demand for housing. The metropolitan regions account for a large part of population growth in Sweden and Norway, and this is why JM concentrates its housing starts in these markets.

It is still too early to determine the extent to which the mortgage ceiling, which was introduced in Sweden in late 2010, has affected the housing market. Most important is the general economic situation which affects demand, prices, and thus indirectly JM's level of housing starts.

JM saw strong profit growth in 2010 due to the higher level of sales and housing starts, as well as a more positive market. We have a strong balance sheet and during the year we distributed SEK 208m to shareholders.

INCREASED PACE OF LAND ACQUISI TIONS

Our portfolio of building rights is one of JM's most important assets and crucial for us to be able to start working on good projects in the future. We acquire land in principle at the same pace that we take land into production. At year-end 2010 we had 27,500 building rights, with an emphasis on Stockholm, Uppsala, Malmö, Gothenburg and the Oslo region.Acquisitions were made in all of these areas during the year.

JM started two large projects in 2010–both with a view of the entry to Stockholm's harbor, popular projects with high reservation rates. The largest project is Kvarnholmen, Nacka, where JM plans to build about 1,200 residential units in the former industrial area. On Lidingö we started working on the project in the Dalénum area, which will be one of JM's flagship projects for many years to come. Our plans include about 1,000 residential units and a large number of workplaces, with first occupancy in 2012.

In late 2010 we acquired properties at Brommaplan in Stockholm to participate in the development of a total solution for the area with homes, workplaces and new communication solutions.

In Norway we also acquired building rights and I would like to increase the production volume even more. One area in Oslo where construction will begin in early 2011 is Grefsen Stasjon, where we are planning for approximately 500 residential units.

HOMES IN ATTRACTIV E LOCATIONS

We aspire to be the customer's first choice when buying a new home. In the case of one of JM's major customer groups, young families with children, we see that many families today are choosing to remain in the city or inner suburbs. They prefer wellplanned, environmentally friendly homes, but would also like to live close to public transportation and good infrastructure. We work closely with end customers and conduct regular surveys to see how our customers want to live and work.

For the past two years, the residential development industry in Sweden has an industry index to measure the Customer Satisfaction Index and according to this index JM has had the most satisfied customers for the second consecutive year. We are proud to be at the top and receive confirmation that our customer focus and sensitivity to our customers' needs are crucial success factors for JM.

SAFE AND SECURE HOUSI NG

Our customers should feel secure when they buy a home from JM and enjoy living in it, and the neighborhood is also important. About ten years ago, we intensified efforts to address security issues and the results included "Botryggt-05," a collaboration involving several major construction companies and the Stockholm police. We have continued this effort and during the year initiated cooperation with the foundation Tryggare Sverige (More Secure Sweden), which is active through its member firms in the business sector. Together we have developed a security program that will ensure that JM always takes security issues into account throughout the chain, from acquisition and planning to production and occupancy.

STANDARDIZED PRODUCTION PROCEDURES

For several years JM has been working with industrial procedures and production methods. We have a competitive advantage because our project development is mainly under our own management, which allows us to keep control of the product.

About a year ago we launched one of the most sweeping change initiatives at JM in many years, which we call Structured Production. Its purpose is to impose standardized procedures at JM to achieve a better work environment at the same time that we improve the quality of our homes and lower production costs. The objective is to identify the best method to carry out the different tasks at the job site. Then we prepare written procedure descriptions and installation instructions to achieve consistency, while keeping an eye on the production schedule.

CEO'S COMMENTS 3

In 2010 we began implementing standardized procedures in production in Sweden, an effort that will continue for several years. This challenge is large and exciting, even with all JM's knowledge of new residential construction. Though it will demand time and energy from JM's organization to begin with, I am convinced that we will succeed.

LOGIS TICS REMAIN A PRIORITY

We see that the more we develop our production processes, the more important the logistics issue becomes. It is increasingly important for deliveries to our sites to be carried out so we get the right quantity and the right quality at the right time. In this ongoing development project on the purchasing side, the requirements have become clearer and prospects for success are now even better, thanks to our project to achieve uniform working methods in production.

JM will continue to guide purchasing volumes towards fewer and more standardized components. Our goal is to be a consistent, uniform customer in relation to our suppliers. Our employees participate and use their experience to influence the process, including collaborative development projects with our preferred strategic suppliers.

COOPERATION WITH ARCHITECTS

Building homes with industrialized processes also requires keeping architects updated on how we work with respect to engineering and production. JM has a good working relationship with architects on housing design and this year we took another step and established close ties with a number of architecture agencies. The aim is to become a stronger partner and create even better conditions for the housing of tomorrow.

FOCUS ON ENERGY

As a leading residential developer, JM also has a responsibility in the environmental field. JM focuses continually on reducing energy consumption and energy needs in the homes both during construction and in operation. We continue to pursue development initiatives to make the buildings even more energy efficient by testing new solutions to learn more so that we can further develop our low-energy house concept. Other important areas are choice of building materials, management of building waste, use of transports and construction machinery and management of contaminated soil. During the year we decided to offset the carbon impact of JM's air travel, though we try to reduce travel in general and use options such as video conferences for many meetings.

MANY NEW EMPLOYEES

The industry is facing a large number of retirements on the production side and a shortage of experienced personnel – both white collar employees and craftsmen. JM aims to be an attractive employer in order to attract new employees, but we must also retain the employees we have today. At JM Academy we offer training programs specially designed for JM's employees, and we are now also starting a pilot project with a site manager training program. We have cooperated for many years with Sweden's largest colleges and universities as well as with Rönninge upper secondary school and Nackademin, a post-upper secondary engineering program in residential construction and contracting in Stockholm.

In 2010 JM hired a total of 350 new employees, including both white collar employees and craftsmen. About half of the salaried employees come directly from colleges or universities.

CONTINUED GOOD FUNDAMENTALS

Demand is good for JM's residential units on our main markets and moving forward, conditions for our business continue to be good, with factors such as large population increases in the markets where we are active. The greatest threat to JM's products would be a slowdown in price and demand due to a worsening of the economy.

We are dynamically positioned with financial strength and a very good project portfolio, and we have now also increased the pace of land acquisitions.

Stockholm, March 2011

Johan Skoglund

Nor dic Region's lea ding developer

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.

OBJECTIV E 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

finan cial target s

DIVID END TARGET—The average dividend over a business cycle should correspond to 50 percent of consolidated profit after tax.

MARGI N TARGET—Operating margin should amount to 10 per- cent, 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.

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 requirement, including a sufficient percentage of reservations and signed contracts for residential units before starting production. JM will maintain a limited, but efficient production capacity to hedge

tenant-owned apartments in Greater Stockholm.	JM is the market leader in new production of
In Frösunda, Solna, we have started building approximately 600 residential units to date. JM's
newly built headquarters is also located here.
	KEY FIG URES
%	Goal	2010	2009	20081)
Dividend, share of profit after
tax	50	632)	57	0
Operating margin	10	9.9	6.7	8.9
Equity/assets ratio	35	40	37	32
1) Financial year 2008 is not restated according to IFRIC 15. 2) Proposed by the Board.

production costs for the long-term, though this strategy 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.

ASS ETS 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 6.5 to 7.5 percent.

avera ge COST OF CAPITAL, SHAREHOLDERS' EQUITY

• • Risk-free return–current assessment of sustainable return on ten-year government bonds is 4.5 to 5.5 percent
• • Risk premium–for the risk the investor takes when investing in JM shares, the risk premium is estimated at 5.0 to 5.5 percent
• • Required rate of return on shareholder's equity (risk-free return plus risk premium) is therefore 9.5 to 11.0 percent.

avera ge COST OF CAPITAL, BORROWED CAPITAL

• • Risk-free return–current assessment of sustainable return on government bonds with a maturity of two years, corresponding 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 6.5 to 7.5 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 6.5 to 7.5 percent of the basic investment in order to be profitable.

Value Generation throu gh Proje ct 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.

HOUSI NG

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 ADV ANTAGES

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 Kvarnholmen in Nacka. In 2010 JM broke ground here for the first of about 1,200 residential units on the island, marking the end of an almost ninety-year long industrial era. Other major projects right now are Liljeholmen in Stockholm, Dalénum on Lidingö, the Eriksberg area in Gothenburg 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. The market surveys JM regularly conducts prior to land acquisition and project starts provide an important foundation for decisionmaking. These surveys analyze customer preferences with regard to type of housing, design and location.

The process from 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 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 building rights take shape with respect to their content. Value grows step by step, as land use is defined. Full land value is attained when the local 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.

COMMERCI AL 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. JM has the goal of retaining some of the developed rental housing for the long-term or selling such units to an external partner for long-term management.

Kvarnholmen in Nacka. The almost 90-year old industrial area …

… is converted into housing and workplaces by the entrance to Stockholm's harbor.

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.

STRONG RECOVERY

Demand for newly built homes improved in 2010 in JM's main markets in Sweden and Norway, resulting in a higher level of housing starts for JM. JM's other markets in Denmark, Finland and Belgium also noted an improvement in the housing market.

In all, JM started construction on 3,404 residential units during the year, compared with about 2,150 residential units the previous year. In Sweden, the number of housing starts totaled 2,834, of which 89 percent were units in apartment blocks and 11 percent single-family homes.Norway had a total of 429 housing starts, 75 percent of which were apartments and 25 percent single-family homes. In Denmark and Belgium construction began on 62 and 48 homes, respectively. Construction began on a neighborhood of 31 single-family homes in Finland. Residential housing starts include 211 rental units in Stockholm for an external client.

MARKET FOR NEW PRODUCTION IN 2010

The economy in the Nordic countries recovered strongly in 2010. Housing demand in Sweden and Norway in particular increased in pace with historically high population growth, an improved labor market and increased household wealth. The historically low interest rates have also had a positive impact on demand for housing.

SWEDEN

The Swedish economy strongly recovered in 2010, with GDP growth of more than 5 percent. Meanwhile, the number of completed housing units decreased markedly in 2010 due to the substantial downturn in the number of housing starts in the autumn of 2008 and spring of 2009. However, the number of housing starts increased in 2010 as a result of stronger demand. We have seen record-high population growth during the year in all metropolitan regions in Sweden, households are enjoying

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

Production start for project by Sjövikstorget, Liljeholmskajen.

a better economy, the labor market continues to improve and interest rates are historically low.

Swedish residential investments as a percentage of GDP continued to be at a low level in an international context in 2010. In Sweden, residential investment as a percentage of GDP is about 3 percent, which can be compared with Denmark at approximately 4 percent, or Norway which has a level of about 13 percent.

JM's biggest segments in Sweden are the metropolitan areas Stockholm, Malmö/Lund and Gothenburg. JM is the market leader in new production of tenant-owned apartments in Greater Stockholm. Major projects include Liljeholmskajen in Stockholm, Kvarnholmen in Nacka and Dalénum on Lidingö.

NORWAY

The Norwegian economy, excluding the oil and gas sector, grew by just over 1 procent in 2010. The number of completed housing units decreased markedly in 2010. Just as in Sweden, this trend was the result of the substantial drop in the number of housing starts in 2009 in particular. The population in the Oslo region continued during the year to show extremely strong growth and accounted for approximately 20 percent of total population growth in Norway.

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.

JM is one of Norway's larger 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 Waldemars Hage in Oslo, Stongafjellet outside Bergen, Lervik in Stavanger and Marius Brygge in Vestfold.

DENMARK

In Denmark the economy recovered and GDP grew by more than 2 percent in 2010. The number of housing starts continued at a low level. The number of completed residential units declined for the third consecutive year and ended on a par with the historic low figures from first part of the 1990s. One bright spot on the housing market is stronger demand, which had an impact on rising housing prices during the year.

JM's operations are concentrated to the Copenhagen area where construction began on a new project, Kajkanten, during the year.

FINLAND

In 2010 GDP grew by almost 3 percent. The number of completed residential units increased somewhat compared with 2009, but continued at a low level. The number of housing starts increased considerably during the year.

JM became established in the region in 2007 and is active in the Helsinki area. In 2010 construction began on a single-family home project.

BELGIUM

The Belgian economy recovered in 2010 and grew by just over 3 percent, which led to rising house prices mainly in the Brussels region.

JM develops residential units in the Brussels region. 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.

In 2010 JM began construction on a new project in Brussels.

RESIDENTIAL INVESTMENT IN RELATION TO GDP 2006 Q1–2010 Q3 SLIDING AVERAGE, CURRENT PRICES

Source: Eurostat and Evidens.

RESID ENTIAL CONSTRUCTION–NUMBER OF HOUSI NG STARTS

Country	2010	2009	2008
Sweden	25,000	16,700	21,600
Norway	21,200	19,600	25,800
Denmark *	15,000	14,400	14,100
Finland*	32,400	23,100	23,500

* Refers to the period Q4 2009 through Q3 2010.

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

JM'S SOLD RESID ENTIAL UNITS

Country	2010	2009	2008
Sweden	2,615	2,686	1,625
Norway	512	502	136
Denmark	84	63	64
Finland	30	12	10
Belgium	35	28	36
Total	3,276	3,291	1,871

JM'S HOUSI NG STARTS
Country	2010	2009	2008
Sweden	2,834	1,791	1,570
Norway	429	359	227
Denmark	62	0	0
Finland	31	0	0
Belgium	48	0	32
Total	3,404	2,150	1,829

JM'S resident ial units in current production

	Dec 31, 2010	Dec 31, 2009
Number of residential units in current production 1)	5,431	3,744
Percentage sold residential units in current production, %2)	64	54
Percentage reserved residential units in current production, %	18	25
Percentage sold and reserved residential units in current production, %	82	79
1) Beginning with production startup through final occupancy according to plan
Of which residential units	690	562
2) Percentage sold residential units expressed as binding contract with end customer

ASSESS ED MARKET POSI TION IN 2010, RESID ENTIAL HOUSI NG MARKET, IN CITIES WHERE JM HAS OPERATIONS

Country	JM's 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 and Arkitekt Gruppen
Belgium**	Among the top 10	Immobel, Thomas & Piron and Bouygues
Finland	***	YIT, Skanska, NCC and Lemminkäinen Talo

* Copenhagen region

** Brussels, Namur and Brabant Wallon

*** Operations began in the Helsinki area in 2007

BREAKDOWN OF SALES STARTS, JM'S TENANT-OWNED APARTMENTS BY PRICE BAND 2006–2010, SWEDEN

BREAKDOWN OF SALES STARTS, JM'S TENANT-OWNED APARTMENTS BY SIZE BAND 2006–2010, SWEDEN

AVERAGE PRICE1) AT SALES START, JM'S RESIDENTIAL UNITS 1999–2010, SWEDEN

MARKET OVERVIEW 11

12 MARKET OVERVIEW JM'S BIGGEST PROJECTS IN 2010

Järvastaden

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 single-family homes. The combination of beautiful scenery and central location make Järvastaden a unique neighborhood.

Location: Solna and Sundbyberg Development period: 2007–2017 Housing type: Single-family homes/ Apartment blocks Number of residential units: – Total: approx. 880 1) – Started: 381 of which 90 singlefamily homes

– Housing starts in 2010: 67 Apartment sizes: 38–114 m2, 2–5 rooms and kitchen Remaining number of building rights: approx. 5501) Location: Close to nature and city Communications: Bus, commuter train, subway Distance to downtown Stockholm: 8 km

1) Number on the balance sheet. In addition, there are approximately 500 building rights under option agreement.

JÄRVASTADEN–A NEIGHBORHOOD CLOSE TO NATURE AND THE CITY

JM is one of several companies developing housing in the area located at the municipal boundary between Solna and Sundbyberg. Behind the initiative to develop and plan the former military area north of Stockholm is Järvastaden AB.

"It's inspiring to work with a large development area like Järvastaden," says Rickard Johansson, project manager for JM in Järvastaden. "We're building block by block and in the spring it will be time for customers in the Löjtnanshjärta project to move into their homes. We've sent information quarterly to our customers so they could follow the building process and I know that many customers have also visited our website to look at photos from the worksite."

The first JM customers in Järvastaden moved into their homes in 2008; so far, we've started construction on approximately 400 residential units in the area–both single-family homes and apartment blocks.

Many of JM's customers in Järvastaden are families with children buying a larger apartment. People are attracted by the proximity to nature and outdoor life combined with a good location close to where the parents work. Hallonbergen's subway station and the Ulriksdal commuter train station are within walking distance of Järvastaden and the train takes only 10 minutes to Stockholm central station. It would seem that Järvastaden residents are figuring out how to put together the pieces of the "Work-Life Balance" puzzle.

When we meet Rickard he is just finishing a meeting with site manager Jonny Åkesson and measurement engineer Marie Öqvist out on the worksite. He notes how important it is for all

Project manager Rickard Johansson in the blue helmet at a meeting with Jonny Åkesson and Marie Öqvist.

employees to be equipped with the skills and knowledge to do a good job and for everyone to have the time to both plan and carry out their work. This approach also fosters an environment in which everyone is accountable and grows with their duties.

"It's stimulating to be part of the process from when the first lines of the blueprint are drawn until the homes are completed and our customers move in," says Rickard.

14 MARKET OVERVIEW JM'S BIGGEST PROJECTS IN 2010

Liljeholmskajen

tastic year round recreation opportunities.

A part of Stockholm's new inner city 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 bridge. Stockholm's water-

Location: Stockholm Development period: 2001–2018 Housing type: Apartment blocks Number of residential units: – Total: approx. 3,200 – Started: 1,801 – Housing starts in 2010: 124 Apartment sizes: 64–142 m2 , 2–5 rooms and kitchen Remaining number of building rights: approx. 1,400 Location: Central Communications: Subway, bus Distance to downtown Stockholm: 5 km

ways–Årstaviken, lake Trekanten, and Mälaren by Vinterviken–offer fan-

Kvarnholmen

Unique location at the entrance to Stockholm's harbor After almost 90 years as an industrial area, the neighborhood will have mod-

ern residential units with a unique waterfront location. The proud heritage from the glory days of industry remains on the island and provides character to the living neighborhood that is now evolving. The new houses have brick and stucco siding that blends in with the surrounding built-up area. From the north shore of Kvarnholmen people can enjoy a view over the entrance to the harbor in Stockholm and Djurgården.

Location: Nacka	Remaining number of building
Development period: 2010–2022	rights: approx. 1,050
Housing type: Apartment blocks	Location: Central
Number of residential units:	Communications: Bus
– Total: approx. 1,100	Distance to downtown Stockholm:
– Started: 54	6 km
– Housing starts in 2010: 54
Apartment sizes: 53–108 m2 ,
2–4 rooms and kitchen

Dalénum

Land with a tradition on Lidingö

In the former AGA area on Lidingö, known as Dalénum, a brand new residential neighborhood is being created. The first houses are directly adjacent to the shoreline in a park area. Dalénum will become a living district with homes and workplaces. In the central part of the area JM is creating an urban personality. The industrial character of the historic district will be refined and improved.

Location: Lidingö	Remaining number of building
Development period: 2010–2018	rights: approx. 7001)
Housing type: Apartment blocks	Location: Central
Number of residential units:	Communications: Train, bus
– Total: approx. 7501)	Distance to downtown Stockholm:
– Started: 60	9 km
– Housing starts in 2010: 60
Apartment sizes: 52–168 m2 ,
2–6 rooms and kitchen
1) In addition there are 225 building rights for rental units.

Kungsängen, Uppsala

Uppsala's new gateway to the south

At Industristaden, industrial land is being transformed into a brand new neighborhood just south of the old urban core Uppsala. Cozy courtyards and tree-lined lanes create green spaces ideal for getting together and relaxing. Natural advantages are enhanced with rooftop terraces or small gardens.

Location: Uppsala	Remaining number of building
Development period: 2002–2017	rights: 470
Housing type: Apartment blocks	Location: Close to city center
Number of residential units:	Communications: Bus
– Total: approx. 1,000	Distance to downtown Uppsala:
– Started: 524	0.7 km
– Housing starts in 2010: 52
Apartment sizes: 43–116 m2 ,
1–5 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.

Location: Malmö	Remaining number of building
Development period: 2003–2013	rights: 214
Housing type: Apartment blocks	Location: Close to city center/by
Number of residential units:	the sea
– Total: approx. 870	Communications: Bus
– Started: 656	Distance to downtown Malmö:
– Housing starts in 2010: 107	0.5 km
Apartment sizes: 36–93 m2 ,
1–4 rooms and kitchen

Small town by the sea

The new town is evolving with low blocks in a stimulating environment with a taste of sun, sand and sea. This mix of tenant-owned apartments with a view of the sea or the park and townhouses with ownership rights is located close to the beach.

Location: Lomma	Remaining number of building
Development period: 2003–2016	rights: approx. 570
Housing type: Apartment blocks/	Location: Close to the sea
single-family homes	Communications: Bus
Number of residential units:	Distance to Lund/downtown
– Total: approx. 1,000	Malmö: 8/10 km
– Started: 440
– Housing starts in 2010: 115
Apartment sizes: 48–131 m2 ,
1–5 rooms and kitchen

16 MARKET OVERVIEW JM'S BIGGEST PROJECTS IN 2010

Norra Älvstranden

Norra Älvstranden continues to grow

Sannegårdshamnen has become one of Gothenburg's most attractive areas. Just a stone's throw from the sea, Västra Eriksberg is emerging, a new area with an urban flavor. Along the quays are walkways, shops, outdoor cafés och venues that contribute to a vibrant urban environment.

Location: Gothenburg	Remaining number of building
Development period: 2002–2015	rights: approx. 300
Housing type: Apartment blocks	Location: Close to water
Number of residential units:	Communications: Bus, boat
– Total: approx. 900	Distance to downtown
– Started: 587	Gothenburg: 5 km
– Housing starts in 2010: 70
Apartment sizes: 40–84 m2 ,
1–3 rooms and kitchen

Öster Mälarstrand, Västerås

Front row seat to nature

Öster Mälarstrand is located in the southern part of Västerås between scenic Mälarparken and the beach at Lake Mälaren. Tenant-owned apartments are being built here in this beautiful setting that encourages outdoor activities.

Location: Västerås	Remaining number of building
Development period: 2008–2012	rights: 891)
Housing type: Apartment blocks	Location: Central
Number of residential units:	Communications: Bus
– Total: approx. 1781)	Distance to downtown Västerås:
– Started: 89	2 km
– Housing starts in 2010: 33
Apartment sizes: 38–111 m2 ,
1–4 rooms and kitchen

1) Number on the balance sheet. In addition, there are approximately 380 building rights under agreement.

Grefsen Stasjon

New residential area in Oslo

With its central location in town with the countryside right at its doorstep, Grefsen Stasjon offers unique living. The park Stasjonsparken is a natural center, with pedestrian walkways, close to Torshosdalens green area.

Location: Oslo, Norway	Remaining number of building
Development period: 2010–2020	rights: 4751)
Housing type: Apartment blocks	Location: Central and close to nature
Number of residential units:	Communications: Trolley, train
– Total: 4751)	and bus
– Started: 0	Distance to downtown Oslo:
– Housing starts in 2010: 0	approx. 5 km
Apartment sizes: 38–187 m2 ,
2–4 rooms and kitchen

1) No building rights on the balance sheet. All as stated under agreement.

JM: THE FIRST CHOICE WHEN BUYING A NEW HOME

Buying a JM home should be as simple, secure and convenient as living in one. 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.

An important part of JM's development efforts involves continuously learning 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 they move in and in connection with the guarantee inspection two years after occupancy.

In addition, customer surveys are carried out with respect to specific themes based on different areas of focus. During the year we carried out an extensive study to obtain relevant information on about one hundred different customer values in a JM home.

JM's annual business development report compiles insights

"SMARTA KVADRAT"

We decided to summarize our offering under the "Smarta Kvadrat," or "Smart Square" concept.

For JM, "Smarta Kvadrat" represents an approach that focuses on carefully thought through and well-planned homes.

We apply this philosophy from the time a new residential area is just a concept in our minds, until the customer moves in and can enjoy a new home–with all that this entails in climate-smart thinking, financial security and room for different personalities.

BUILDING WHERE PEOPLE WANT TO LIVE IS SMART

Customers 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 communications and good infrastructure, where the streets, lawns, playgrounds and other amenities are ready when customers move in.

OFFERING WELL-PLANNED SOLUTIONS IS SMART

In JM homes everything is new from the start. JM Original is standard in all homes, offering 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 part of the process and influence the final result.

BUILDING ECO-FRIENDLY 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 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 PURCHASE IS SMART

One very important component for community builders is to build safe neighborhoods and residential environments. About ten years ago, we intensified efforts to address security issues and the results included "Botryggt-05," a collaboration involving several major construction companies and the Stockholm police. In January 2010 JM initiated a cooperation with the foundation Tryggare Sverige (More secure Sweden). Together we have developed a security program that will ensure that JM always takes security issues into account throughout the chain, from acquisition and planning to production and occupancy. The program includes a security analysis carried out early in the project in collaboration with architects and the municipality's administrators in the planning offices.

Our customers should feel secure when they buy a home from JM. We offer 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.

CUSTOMER ADVOCATE

JM always strives to achieve good quality and to be able to provide customers with flawless homes at the right time. Naturally we always want to treat our customers right, but sometimes misunderstandings arise and sometimes we make mistakes. The customer advocate is a JM employee whose job is to examine customer complaints about projects and to mediate, when needed, between the customer and JM.

about trends in our community 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.

THE MOST SATISFIED CUSTOMERS IN THE INDUSTRY

Satisfied customers are the most important key to success. The Customer Satisfaction Index (CSI) measures customer satisfaction in the residential development industry in Sweden. For the second consecutive year, JM has the most satisfied customers in the industry with a CSI of 75, which can be compared with the industry index of 69 of 100 potential points. JM's best projects in 2010 were Gyllins Trädgård in Malmö, Lund Väster in Lund and Hornsplan in Stockholm. (Source: Prognoscentret.)

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 to our homes. Being a VIP customer costs SEK 200 per year.

Interest in, and the influx of, new VIP customers was very positive in 2010, with the addition of 6,500 new VIP customers.

PERCENTAGE OF JM BUYERS WHO ARE VIP CUSTOMERS

2010	2009	2008	2007	2006
32%	27%	34%	26%	19%

GOOD MATERIAL CHOICES AND STANDARD

The interior design is an important part of the planning process from the time we start drawing a new residential project. After customers reserve their new homes they receive the Interior Guide, in which we present our carefully planned JM Original standard and our available upgrades. Customers then meet the project's interior designer and review their choices for their dream home. JM's interior designer works to create conditions for good material choices and a good basic standard. We monitor the trends–those that affect how we live in the longer term, such as the influence of environmental issues on how we view material choices and design.

DIGITAL DEVELOPMENT CONTINUES AT JM

In 2010 JM became established in the social media and launched

Advertisement in daily papers in Sweden–"Most satisfied customers".

a Facebook group, as well as YouTube and Twitter channels. We took these initial steps to learn more about these channels and to offer our customers and other stakeholders a new opportunity for dialog with JM.

JM launched its first mobile application. To begin with, the application contains information about all current projects. Visitors to JM's model homes can view videos and other extra information on their phones which can be downloaded. While they are visiting the construction site, app users can also see images showing what selected projects will look like when completed.

interior styles

For the past few years we have been working with six interior styles. JM has chosen to call the styles Trend Contemporary, Trend Eco, Natural Genuine, Modern Urban, Classic Rustic and Classic Poetic.

New for 2010 is Trend Eco, a permissive style, with plenty of room for personality. We are now working on interpreting this style in terms of kitchen cabinets, fittings, tile, etc., to create the right conditions for the interior of a personalized trend-setting home.

JM wants to be where the customers are, so development of digital channels and mobility will become increasingly important.

OPEN HOUSE DAYS IN CURRENT PROJECTS

The Big Open House Day is a regular event during which all JM residential projects are open to the public on the same day. JM presents its solutions to the expectations, needs and requests our customers express in JM's regular market surveys. In 2010 JM hosted five Big Open House Day events. The theme during the spring was garden and balcony, and during the autumn we focused on bathrooms.

The open house days continue to be popular, with a visitor count of about 2,000 people on each occasion. These events attract many new potential buyers. Over 70 percent of visitors state that the visit increased their interest in buying a JM home in the future. In 2010 JM's model homes in Sweden, Norway and Denmark were open during the summer, resulting in many new customers in an otherwise sleepy summer market.

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

entré

JMs customer magazine entré is mailed home to VIP customers four times per year.

The magazine contains articles about customers who have just moved into their homes, descriptions of new residential areas, information focused on various themes and planned residential projects.

NUMBER OF RESIDENTIAL UNITS AT DIFFERENT PLANNING PHASES,

NUMBER OF RESIDENTIAL UNITS AT DIFFERENT PLANNING PHASES,

MARKET VALUE, RESIDENTIAL BUILDING RIGHTS,

Residential building rights provide good prospects

JM continuously invests in land that can be developed for future production and had 27,500 building rights available (27,900) at year-end 2010. The geographic distribution of building rights is as follows: 40 percent in Greater Stockholm, 35 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, 17,600 (18,400), and building rights that are available through conditional acquisitions or cooperation agreements, 9,900 (9,500). 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 increased to SEK 5,314m (4,882) at the end of the year.

GOOD COMPOSITION

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. At the same time we see a clear trend that central urban locations are becoming increasingly attractive.

At year-end 2010, an external appraisal company 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 7.9bn (6.8). The corresponding carrying amount is SEK 5.3bn (4.9). The 9,900 residential units available through conditional acquisitions were not included in the assessment.

JM's available residential building rights

	Number of building rights
Area	2010	2009
Greater Stockholm excluding Sigtuna, Vallentuna, Norrtälje	11,100	10,700
Malmö, Lund, Helsingborg, Halmstad	3,600	3,600
Greater Gothenburg, Linköping, Jönköping	2,700	2,700
Uppsala, Sigtuna, Vallentuna, Norrtälje, Västerås, Örebro	3,300	3,900
Oslo region	3,450	3,250
Bergen, Stavanger	1,550	1,550
Greater Copenhagen	750	900
Helsinki	150	300
Brussels	900	1,000
Total (approx.)	27,500	27,900

Market value is broken down as follows:

	Market value		Carrying amount
SEK billion	2010	2009	2010	2009
Stockholm	4.3	3.2	2.6	2.1
Rest of Sweden	2.0	1.9	1.5	1.5
International	1.6	1.7	1.2	1.3
Total	7.9	6.8	5.3	4.9

Some of the development properties have old existing buildings that generate operating net and with future plans for renovation or demolition. The valuation of these buildings is based on current rental revenue and future use, taking costs for essential conversion and extension or demolition into account. The market value of these buildings is included in the summary.

An appraisal company has classified the phases of the planning process into the following phases; raw land, general plan, detailed plan and building permit. The diagrams on page 20 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.

PROPE RTY DEVELOP MENT SUPPO RTS THE HOUSING BUSINESS

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 PROPE RTIES

Transaction volumes increased in 2010, which can mainly be attributed to domestic participants. However, foreign investors are beginning to find their way back to the Swedish real estate market. (Source: NAI Svefa.)

The Markan rental housing project in Hägernäs, Täby was completed in 2010. Heba Fastighets AB bought the property, which consists of 52 rental homes with a total area of 2,848 square meters.

The Ymerplan senior housing project in Sigtuna opened in the spring of 2010. The buyer was KPA and the usable area is 5,400 square meters in 72 apartments.

In September 2010 the Solbacka project for special housing for the elderly in Norrtälje was completed, with 64 homes and total area of 4,368 square meters, with Norrtälje Municipality as the tenant.

Lidingö Municipality approved the local plan for Dalénum in March 2010. In addition to about 1,000 homes, including 225 rental units, the local plan also includes a senior housing facility. Development work for the senior housing project began in 2010 and is being carried out simultaneously with the housing construction.

We are constantly looking for land to acquire for rental apartments in Stockholm and the surrounding municipalities. During the year these efforts have intensified as we search for land with leasehold rights, mainly in Stockholm. In January land was allocated for about 100 homes in Stureby and work on the local plan for the project is expected to start in 2011.

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

COMMERCIAL PROPERTIES

Office rents in the Stockholm market appear to have reached bottom and the market is showing signs of stabilization. Since year-end 2009, rents have risen in the Central Business District and are currently around SEK 4,000 per square meter. (Source: Jones Lang LaSalle.)

Transaction volumes in Sweden have more than doubled in 2010 from a low level in 2009. (Source: Jones Lang LaSalle.)

The Dalénum premises on Lidingö are located in traditional old industrial buildings that were converted into modern offices. The commercial portions of the project have transitioned to a management phase. The largest tenant, AGA, has a 10-year lease for about 8,000 square meters. According to the local plan proposal, after demolition and conversion to residential units, more than 42,000 square meters of commercial premises will remain with about 1,000 homes, including 225 rental units.

Project management of Bolinder Strand on the shores of Lake Mälaren, also in traditional industrial buildings in a beautiful location, has made progress during the year. The commercial premises were developed and efforts to find tenants are moving forward.

In December two properties were acquired, Grammet 1 and Vävnaden 1, by Brommaplan in Stockholm. The acquisition includes about 7,300 square meters of commercial premises. The plan calls for a total of about 14,000 square meters of commercial and service facilities and approximately 600 residential units at Brommaplan. Construction is planned to begin in 2013.

MARKET VALUATION – PROJECT PROPE RTIES		Dec 31, 2009
	Market value, SEK m	Carrying amount, SEK m	Area (000) m²	Occupancy rate annual rent, %	Carrying amount, SEK m
Properties under development	541	530	58	88	558
Fully developed commercial properties	144	131	7	98	38
Total	685	661	65	89	596

JM RESIDENTIAL Stockholm

MARKET

Demand for housing continues to be good and interest in JM's projects is strong with solid sales during the year. The supply of new homes continues to be low in relation to long-term demand in the Stockholm area. Historically high population growth and households with a stronger economy are keeping demand high.

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 major projects in the region are Liljeholmen/ Stockholm, Kvarnholmen/Nacka, Dalénum/Lidingö, Järvastaden/Solna/Sundbyberg, Långbro/ Stockholm, Kojan/Västra Kungsholmen, Fågelviken/Örnsberg, Norra Frösunda/Solna and Hägernäs/Täby.

earnings trend

The business segment's income increased to SEK 3,824m (3,330) and operating profit increased to SEK 634m (496). The result includes SEK 30m attributable to two divestments of properties in ongoing projects. The operating margin increased to 16.6 percent (14.9). The increased operating margin is mainly attributable to the higher price level of the projects. Major investments in development properties and cash paid had a negative impact on cash flow during the year.

BUILDING RIGHTS

During the year building rights equivalent to about 900 (120) residential units were acquired on Lidingö, in Nacka, Stockholm, Sundbyberg and Tyresö.

HOUSING STARTS

During the year production began on 1,604 (1,102) residential units, including 990 in Stockholm, 137 in Järfälla, 134 in Solna, 99 in Sollentuna, 91 in Nacka, 60 on Lidingö, 58 in Värmdö, 22 in Täby and 13 in Sundbyberg.

The new local plan for the Dalénum area gained legal force during the year.

JM RESIDENTIAL Stockholm

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.

Lush courtyard setting in Frösunda Park, Solna. Liljeholmskajen, part of Stockholm's new inner city.

JM residential sweden

MARKET

Demand for housing continues to be good. Interest in JM projects is strong, as is customers' willingness to sign contracts, resulting in continued good sales. Factors behind the strong recovery in the housing market include continued good population growth, households with a stronger economy and an improved labor market.

The largest segments in JM Residential Sweden are Gothenburg, Malmö/Lund and Uppsala.

Larger projects are in progress in the former harbor neighborhood at Norra Älvstranden and in Kviberg in Gothenburg, in Kungsbacka, in the Dockan area in Malmö, at Lomma Strandstad in Lomma Municipality and in the sugar mill area in central Lund.

The largest projects in Uppsala are Kungsängen and Luthagen, close to the center of town.

earnings trend

The business segment's income was SEK 2,749m (2,296) and operating profit was SEK 219m (166). The operating margin increased to 8.0 percent (7.2). The increased operating margin is mainly attributable to the higher price level of the projects. The strong cash flow is mainly due to the reduction in operating capital.

BUILDING RIGHTS

During the year building rights equivalent to about 950 (400) residential units were acquired in Gothenburg, Helsingborg, Linköping, Lund, Malmö, Uppsala and Örebro.

HOUSING STARTS

During the year production began on a total of 1,230 (689) homes: 966 (570) were residential units in apartment buildings, including 392 in Skåne (179 in Malmö, 145 in Lomma and 68 in Lund), 112 in Gothenburg, 29 in Jönköping, 59 in Linköping, 32 in Örebro, 82 in Västerås, 200 in Uppsala and 60 in Vallentuna.

Production starts included 264 (119) single-family homes, of which 169 in Skåne (39 in Malmö, 45 in Staffanstorp, 39 in Lomma, 32 in Lund and 14 in Helsingborg), 38 in Kungsbacka, 23 in Jönköping and 34 in Sigtuna.

JM residential sweden

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.

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

JM international

earnings trend

The business segment's income increased by 16 percent to SEK 1,570m (1,353). Operating profit increased to SEK 48m (–192) and operating margin to 3.1 percent (–14.2). The improvement in profit and operating margin can be attributed to better demand, increased project volume and a more stable market.

The positive cash flow is mainly due to the reduction in operating capital expressed as fewer unsold units in the balance sheet.

norway

Demand for newly built homes and homes on the existing home market continued to be good. The supply of homes for sale in the market has stabilized at a relatively high level. Prices on the existing home market rose at a slower pace during the second half of the year.

During the year 512 residential units (502) were sold and production began on 429 (359) units.

Building rights equivalent to about 550 residential units (0) were acquired during the year. Available building rights correspond to about 5,000 residential units (4,800).

denmark

The Copenhagen housing market is characterized by low activity and some improvement of demand. Banks continued their restrictive lending practices, which offset the positive effect of lower interest rates.

During the year 84 residential units (63) were sold and production began on 62 units (0). Production in one large project in central Copenhagen (Egholm) with 165 residential units was completed during the first half of 2009 and sold during the fourth quarter of 2010.

No acquisitions were made during the year. Available building rights correspond to about 750 residential units (900).

finland

Activity on the housing market in the Helsinki area gradually increased during the year and the submarkets where JM is active also improved. Interest in newly built homes is strong and prices on the existing home market are showing a rising trend.

During the year 30 residential units (12) were sold and production began on 31 units (0). Building rights equivalent to about 50 units (0) were acquired during the year. Available building rights correspond to about 150 residential units (300).

belgium

In the Brussels region, where JM has its operations, activity in the housing market stabilized at a higher level.

During the year 35 residential units (28) were sold and production began on 48 units (0).

No acquisitions were made during the year. Available building rights correspond to about 900 residential units (1,000).

JM international

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

Income	1,570	1,353
Operating profit 1)	48	–192
Operating margin (%)	3.1	–14.2
Average operating capital	1,838	1,936
Return on operating capital (%)	2.6	–9.9
Operating cash flow	236	–174
Carrying amount, development properties	1,255	1,320
Carrying amount, project properties	34	32
Number of available building rights	6,800	7,000
— of which building rights on the balance sheet	4,400	4,400
Number of residential units sold 2)	661	605
Number of housing starts 3)	570	359
Number of employees	250	240
1) Of which—property sales	-	12
—impairment losses on properties	-	–87
2) Of which rental units	-	48
3) Of which rental units	-	48

Waldemars Hage in Oslo, Norway.

JM property development

EA RNINGS TREND

The business segment's income decreased to SEK 72m (309), including rental revenue of SEK 60m (60) and contracting revenue of SEK 12m (249). Operating profit fell to SEK 12m (110). The reduction is due to a lower volume of activity since the office project in Frösunda for Vasakronan was completed at the beginning of the year.

Contracting revenues from production amounted to SEK 5m (63). Net operating income for project properties was SEK 10m (–6). The improvement of net operating income is due to factors such as increased rental income in the Dalénum area on Lidingö.

Gains on property sales amounted to SEK 26m (75), of which SEK 17m (28) relates to the reversal of provisions from previous property sales.

PROPERTY TRANSACTIONS

The development property Signalen in Solna was sold for SEK 35m, with gains of SEK 7m. In addition a few smaller property sales resulted in gains of SEK 2m.

PROJECT DEVELOPMENT

In Norrtälje Municipality, the Solbacka project–a special housing for the elderly–was completed in September, with 64 homes and the municipality as the tenant.

In the Bolinder area in Kallhäll, Järfälla, commercial premises are under development adjacent to JM's residential project. The occupancy rate at year-end was 89 percent.

Tenant adjustments in the existing stock continue in the Dalénum area on Lidingö. The occupancy rate in the buildings that will be kept is 87 percent. JM is working on plans for a senior housing project with 54 residential units. The plans also include construction of 225 rental apartments in a later stage.

At the end of the year JM worked on the plans for a sheltered housing project in Sjövikshöjden, Liljeholmen. Construction is expected to begin in the spring of 2011. A lease was signed with the Municipality of Stockholm.

BUILDING RIGHTS

JM's building rights for commercial project development amount to 60,000 square meters, including 40,000 square meters in office building rights. Residential building rights account for 16,000 square meters and building rights for senior housing account for 4,000 square meters. The carrying amount is SEK 60m.

During 2010 land was allocated for about 100 rental apartments in Stureby.

JM property development

The JM Property Development business segment primarily develops rental housing, residential care facilities and commercial properties in Greater Stockholm. The business segment's entire portfolio comprises project development properties.

Solbacka – senior housing in Norrtälje.

JM Production

MARKET

Demand on the contracting market continues to show recovery with customers more willing to invest. The commercial construction market continues at a high level. With the recovery in housing construction, competitors engaged in their own project development are allocating fewer resources to contracting.

EARNINGS TREND

The business segment's income declined to SEK 1,496m (2,008) and operating profit declined to SEK 91m (130). The operating margin was 6.1 percent (6.5).

PROJECTS

During the year JM accepted several major assignments, including two phases of the new E18 highway (Hjulsta–Kista) for the Swedish Transport Administration, new construction of rental apartments in Åkersberga for external client and renovation and new construction of schools for Nacka and Sollentuna Municipalities. We are also building streets and conduits in Hammarby Sjöstad for the City of Stockholm, an expansion of an existing residential building in Stockholm for an external client and new apartment buildings in Bromma and on Värmdö for JM Residential Stockholm.

Renovation of the Gamla Riksarkivet (Old National Archives) on Riddarholmen in Stockholm.

JM Production

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

One major project in progress involves the renovation of Gamla Riksarkivet (Old National Archives), Riddarholmen, for Statens Fastighetsverk (the National Property Board). Development work is in progress on Lidingö for JM Residential Stockholm. In Värmdö Municipality, initial planning for future operations is under way in the Ekobacken area. In the Ulvsunda area in Bromma, preparatory ground work is underway for a planned depot operation for Storstockholms Lokaltrafik. In Gubbängen, in south Stockholm, JM is building new energy-efficient "passive" homes in a rental apartment project for AB Stockholmshem.

Large projects during the year that have now been concluded include the completion of a cogeneration plant in Södertälje for Söderenergi AB, expansion of the tram route in central Stockholm and new construction of bridges for Roslagsbanan in Åkersberga, both projects for Storstockholms Lokaltrafik. Conversion of an existing office building on the Karolinska hospital campus into housing was carried out for Locum. Excavation and development in Henriksdalshamnen and soil remediation in Hjorthagen were performed for the City of Stockholm, and new construction of a school in Sollentuna Municipality was completed. One large internal project involved new production of rental units in Täby for JM Property Development.

SUSTAINABILITY FROM THE PERSPECTIVE OF A COMMUNITY BUILDER

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 project developer of housing, sustainability is a hallmark for JM.

Sustainable community building refers to economic, social, ethical and environmental accountability, usually summarized by the concept of Corporate Social Responsibility (CSR). JM's sustainability initiatives are reported in the annual report in the sections "Board of Directors' Report", "Sustainable urban planning" and "Employees".

THE ENVIRONMENT: A TOP PRIORITY

The most important aspect of sustainability for JM involves environmental initiatives, because that is where the Company has the greatest impact on society in the markets where JM is active. JM has group-wide policies and objectives, such as JM's quality and environmental policy that apply to all operations. This section describes our environmental initiatives within JM's project development and contracting operations in Sweden.

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. As a homebuilder, we carry a heavy responsibility with respect to the environment for future generations. We aspire to achieve the obvious: to create attractive and functional housing, use ethical business methods and place equivalent demands on our suppliers.

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

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

PROJECT DEVELOPMENT IN SWEDEN ENERGY

The energy consumption of the houses is constantly in focus since climate change is one of the major challenges of our time. Consequently, JM focuses on reducing energy consumption and energy needs during both construction and operation.

For years, JM's most important environmental objective has been to decrease energy consumption and its impact on climate change. JM has become the European leader in building energy-efficient housing–based on the entire production, 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's defines low-energy houses as houses that meet the authorities' energy requirements during operation with a substantial margin.

THIRTY PERCENT BELOW THE CURRENT STANDARD

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.

JM continues to dedicate resources to make the houses even more energy efficient by continually testing new solutions to

ENVIRONMENTAL IMPACT OF PROJECT DEVELOPMENT

	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

learn more and, by extension, improve our low-energy house concept. One such development project is Presse Park in Kungsbacka, south of Gothenburg, 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. Evaluation of construction methods, costs and energy consumption for these houses compared with two reference houses in the area provide us with valuable information in our aspiration to be the leading builder of low-energy houses. Similar houses were built in Valla, Linköping.

In 2006 JM presented its project with 16 energy-efficient townhouses 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. Last year Lund Institute of Technology reported the results of this initiative, demonstrating that the goal was met by a wide margin: energy consumption was been cut in half and in some cases down toward one third. Over the past year researchers studied the effect of solar panels installed on two of the houses. The results show that the solar panels reduce the need to purchase energy for hot water production, while the need to purchase energy for heating remains unchanged. The reason is that solar panels work best during the warm half of the year, when heating is unnecessary. The benefits of solar panels vary greatly due to varied habits for hot water consumption among households. However, on average the need for purchased energy decreases by 8–10 kWh/square meter and year, or more than 1,000 kWh/year for a townhouse in Järinge.

JM has decided that all new commercial properties built by JM will comply with the Green Building Standard, which requires energy consumption to be at least 25 percent less than the building standard.

ENERGY CONSUMPTION DURING PRODUCTION

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, JM is working on energy efficiency measures during production; for example, all job sites have energy-efficient

EXAMPLES OF FEATURES OF JM'S LOW-ENERGY HOUSES

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

sheds and low-energy lighting (with light and motion detectors). Energy consumption can be further reduced by using early startup of district heating to heat the house frames during construction.

MATERIAL CHOICE AND CONSTRUCTION

The growing use of chemicals in society is a major problem. 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 use of chemicals and 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–a project within the construction industry to discontinue the use of hazardous substances. BASTA goes farther than the EU's REACH chemical legislation with respect

MORE ENERGY EFFI-CIENT 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 WALLS

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.

SENSITIVITY TO PEOPLE WITH ALLERGIES Research has shown that there may be a relationship between allergic problems in children and PVC. JM's residential units have PVC-free walls and flooring. The landscaping surrounding JM houses use nontoxic plants and trees that are suitable for people with allergies, such as apple trees and roses. Kitchens and bathrooms should be easy to clean. JM avoids dusty shelves in the kitchen by installing cabinets that go up to the ceiling. In bathrooms, the tub is designed so that it is easy to keep the floor and floor drain clean.

A GOOD SOUND ENVIRONMENT

Many people perceive loud sounds and noise as one of the biggest problems in the residential environment. Our residential units are quieter than what Swedish building regulations require. Our extra thick walls and floor structure provide very good insulation between apartments. Our exterior doors are required to have a good sound transmission class and we avoid mail slots in doors by placing mailboxes in the entry to the stairwells, and newspaper delivery boxes by the apartment doors.

GOOD ELECTRICAL ENVIRONMENT We minimize exposure to electrical and magnetic fields. We always use a five-wire system, which limits the magnetic fields throughout the building, and we avoid locating distribution boxes close to the bedroom.

to phasing out hazardous substances. JM has initiated the BASTA system and is an active member of its development council.

All pre-construction and installation work in JM's residential units comply with requirements under 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 also works with methods during planning and production to avoid humidity in the building to prevent moisture and water damage. We use moisture-tolerant and moldresistant 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.

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 the construction sites in Sweden that most successfully sorted construction waste for recycling. The Ecocycle Council industry guidelines for waste management during construction and demolition, which JM helped to develop, are integrated in procedures for all JM projects in Sweden.

TRANSPORTS AND MACHINERY

Construction machinery and transports of goods and people 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. JM is making progress in our efforts to develop logistics processes in 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 in 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. In the agreements JM signs with shippers we have gradually implemented stricter requirements during the year that are in line with the "QIII system," a tool specially designed by the Swedish Transport Administration to help purchasers of shipping services improve with respect to workplace health and safety, road safety and the environment.

Today JM in Sweden makes demands about the fuel that 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 headquarters and all regional and department offices, many trips have been avoided and we have thereby reduced carbon dioxide emissions from business trips. JM has also decided to offset the carbon impact of its air travel by investing through a supplier in carbon reduction projects included in the UN Clean Development Mechanism (CDM), a system in which the UN reviews and verifies the greenhouse gas benefits of projects. JM invests in "Gold Standard" projects that are also approved by major environmental players such as WWF and Greenpeace.

CONTAMINATED SOIL

JM often acquires former industrial land that is transformed into desirable residential areas after remediation of the soil. JM is thereby making a large contribution from the standpoint of health and the environment by removing heavy metals and oil pollutants from the soil 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 at the job site reduces the need for truck transports. For example, at Dalénum on Lidingö outside Stockholm it has been possible to recycle about 6,000 cubic meters of soil in the area to date thanks to good planning, cooperation and sampling.

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 coordinators, one in Stockholm and one in Malmö. Procedures are also clearly described in JM's operations management system.

JM PRODUCTION

The JM Production business segment comprise the subsidiary JM Entreprenad AB, which engages in residential construction, site preparation and facades for external and internal clients within the Greater Stockholm area. During the year JM Entreprenad AB became ISO-certified to ISO 9001 and ISO 14001, which confirms that the company has an effective quality and environmental management system. Environmental initiatives include reduced energy consumption, waste sorting, soil remediation and proactively choosing the best environmental transportation and shipping alternatives.

The company's business model promotes a policy to influence clients by proposing the most environmentally sound choices with respect to products, transports or methods. JM's agreements with partners and suppliers stipulate that they must meet environmental requirements.

JM Entreprenad AB has worked with an external client during the year and completed a project called Modemet in Kista. In addition to its green production model, JM Entreprenad carried out a project to maximize the percentage of building waste that can be reused or recycled. By sorting all waste, packaging and waste products directly in connection with each craftsman, a recycling and reuse rate of 98 percent was achieved. The system is tailored to both new construction and renovation and will continue to be implemented in our projects wherever possible.

After careful evaluation of the organization and its skills, JM Entreprenad AB was selected in a competitive bid situation to work on a collaborative project for a public housing company in Stockholm to develop an apartment building with extremely low energy consumption. The project goal is to achieve what is known as a "plus house," referring to a house that generates more energy annually than it uses. Engineering and planning were carried out during the autumn and construction is planned to begin during the first quarter of 2011.

SMART LOGISTICS SOLUTIONS

JM's "smart logistics solutions" project focuses on environmental management of excavated material to and from our construction projects. Two facilities are currently in operation in Stockholm and additional facilities will be taken into operation over the next few years. The goal is to have at least four sites in operation in the Stockholm area, one at each end of the city. A digital service has been developed to deploy clean excavated material between projects within the Company. A map with search function is available on the Intranet that presents locations of external crushing plants and dumping areas for clean material. Planning for site preparation projects is facilitated and transports of excavated material and crush material can be reduced, which benefits both the environment and project finances.

HOW WE WORK

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 advocate 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 the long term. Environmental responsibility rests with the line organization with support from the central staff. 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 ultimate responsibility for common governance and operations in Sweden, including environmental issues. The Group's quality and environment department is responsible, together with regional quality and environment 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 from both wage-earners and salaried employees.

OVERSIGHT AND FOLLOW-UP

In every substantial way, the operational systems developed by the project development operation in JM Sweden meet the standards set by ISO quality and environmental management requirements. The primary goal has been to develop a system adapted to the processes and needs of the operation, but the organization is also well prepared for 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.

PARTNERS

Much of JM's impact on the environment occurs via the Company's external partners such as subcontractors and materials suppliers. All strategic 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 41 percent, from 227 to 320.

INDUSTRY ISSUES

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

To support its focus on climate issues, JM has been a member of the international network Business Leaders Initiative on Climate Change (BLICC) for many years. 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.

The network was dissolved during the autumn and JM is work-

ing on starting a new climate network, the Haga Initiative, aimed at encouraging businesses to calculate their carbon footprint while demonstrating that profitability can be successfully combined with a proactive approach to climate change.

During the year JM joined Sweden Green Building Council, a member-owned non-profit organization open to all companies and organizations within the Swedish construction and real estate sector that wish to develop and influence environmental and sustainability work in the industry. The association would like to meet the public's need for clear and quality assured information on the environmental performance of buildings as well as to help increase the competitiveness of Swedish technology and Swedish expertise.

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 taking part in running three development projects in cooperation with Sustainable Innovation. One of them involves evaluation of a new type of ground heat exchanger. Two houses in JM's single-family home project in Hålludden, Värmdö Municipality outside Stockholm, have this type of heat exchanger. The Royal Institute of Technology (KTH) is coordinating the evaluation project and the results are expected to be ready in the spring of 2011.

In 2011 JM decided to sign and implement the principles for sustainable business practices under the UN Global Compact.

JM is participating on the program board for the SBUF mandate on the third phase of the 2008–2011 SolEl (solar energy)

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. During the fall JM hosted a well attended solar energy seminar, which presented the latest developments in the Swedish and international solar PV market and in building integration.

PROFITABLE ENVIRONMENTAL PROGRAM

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 is the way JM can continue 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 has been listed on the OMX GES Sustainability Nordic Index since January 2010.

GROUP QUALITY AND ENVIRONMENTAL POLICY

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 ENVIRONMENTAL OBJECTIVES

• • 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 FIGURES ENVIRONMENT JM SWEDEN

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

	2010	2009	2008
Implemented internal quality and environmental audits	140	126	106
Carbon dioxide emissions JM (tons) 1)	11,800	11,400	15,800
Carbon dioxide emissions JM (tons/SEKm) 1)	1.45	1.43	1.46
Newly produced homes' estimated carbon dioxide emissions from energy consumption (kg CO2/m2 UFA)	6	6	7
Percentage of building waste that goes to landfill (%) 2)	16	16	15
Products in environmental product database	3,271	2,952	2,731
Number of frame agreements with expanded environmental review	320	227	205
Projects with key indicators (%) 2)	85	96	100
Projects with key indicators (numbers) 2)	22	44	59
Goal fulfillment JM Residential Stockholm and JM Residential Sweden	2010	2009	2008
Newly produced homes' estimated energy requirement, including household electricity, (kWh/m2 UFA)	85	92	100
Building waste to landfill (kg/m2 GFA)	4.4	4.1	3.6
Percentage unsorted building waste (%)	23	33	30
Total quantity building waste (kg/m2 GFA)	28	25	24

1) Calculations apply to all of Sweden.

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

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

SKILLS AND SATISFACTION CENTRAL TO CONTINUED SUCCESS

A place to feel at home–that's what our business is basically all about, whether we're building or developing homes and neighborhoods. But to satisfy others, we have to be satisfied with our jobs too.

That's why JM's organization promotes open decision-making and good growth opportunities. It is easy to be seen and recognized at JM. Personal responsibility and growth are important elements for ensuring that JM has the right skills in the long-term.

We have experienced a gradual recovery since the recession and we are now beginning to hire again. JM has hired a total of 350 new employees, evenly distributed between salaried employees and wage-earners. About 50 percent of salaried employees are recent college or university graduates. Access to engineers and the large number of retirements in the labor market at large continue to be a challenge for JM. In the long-term, the ability to attract new talented employees, while retaining those we already have, will be essential for our continued success.

Our core values influence our relationships with our employees: quality, a long-term approach, reliability, commitment, sensitivity and a sense of style. JM clearly encourages all employees to achieve a good balance in life between work and family. Every other year JM carries out an employee survey to take the pulse of the atmosphere, leadership and organization at work. In the most recent survey, a full 85 percent of employees stated that they would recommend JM as an employer.

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 the personal meeting with managers and colleagues.

Staff turnover in 2010 was 6 percent (6) in Sweden and the average length of employment was about 11 (12) years. The age structure at JM continues to be evenly distributed. With current staffing of about 2,100 employees we have capacity for about 3,500 to 4,000 housing starts annually.

SKILLS DEVELOPMENT AND SUPPLY OF EXPERTISE

Employee performance appraisals are carried out with salaried employees at least once a year to follow up on target fulfillment and to assess employee or leadership skills; outcomes are related to the pay setting system. New goals are set during this meeting and to reach them, individual developmental needs are reviewed and an individual development plan is prepared.

For both salaried employees and wage-earners, skills development largely involves job rotation and active on-the-job learning.

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 costrequirements 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 partnersto pay for ourtravel 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.

The skills and experience of JM employees are among the most important success factors in JM's sweeping Structured Production project, see page 2 Standardized production procedures.

JM mainly meets requirements for managers and leaders through internal recruitment, which provides good opportunities for individual development within the Company, while strengthening the corporate culture and 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

At JM Academy we offer a number of leadership development activities aimed at developing the leadership skills we identified and that are needed to achieve JM's overarching goals, and to be able to live and act in line 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. Over 500 department heads and leaders have completed the Leadership

Erika Lundvall, a student from the Royal Institute of Technology (KTH), discusses her degree project "Staffing planning for craftsmen" with Jonny Änges, her supervisor at JM. Erika has worked at JM in a variety of capacities during her studies and she is now starting as assistant foreman at the Långbro Park project.

training program at JM and we now have a common base and vision of what management at JM should look like.

JM'S TRAINEE PROGRAM

JM has offered a trainee program since 1994 to ensure its supply of skills and leaders for the future and in 2010 we started the first group-wide program with participants from both Sweden and Norway. The program consists of five different five-month blocks and several theoretical courses. These five blocks–production, project development, sales, operational development and purchasing–provide the trainee with a wide range of skills in residential development. Trainees are also based in another town for at least one block to further broaden their network of contacts and help to build "one JM".

JM'S COOPERATION WITH SCHOOLS

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 universities, we cooperate with several post-upper secondary schools, such as Rönninge Upper Secondary School. 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 engineering 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 BENEFITS

About 700 of JM's salaried employees in Sweden are covered by a performance-based salary system. The amount usually varies between one and six monthly salaries, depending on the employee's position. Since 2001 JM has offered employees born 1978 or earlier, with a pensionable annual salary over ten official "base amounts", a pension plan, "ITP Tillägg", with improved pension and insurance terms and conditions. The ITP Tillägg program provides employees with five percentage points more in retirement pension and guarantees a higher family pension and disability pension than traditional ITP.

Since 2001 JM has compensated employees for loss of income during parental leave 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 benefit provided in collective agreements. The purpose is to support parents and help to achieve increased gender equality. In 2010 a total of 93 employees (97) took advantage of this opportunity.

DIVERSITY AND EQUAL OPPORTUNITY

Today 31 percent (31) of JM's administrative staff are women, of which 35 percent (32) are leaders or managers.

Swedish society is characterized by increased cultural, social and religious diversity and for JM increased diversity among employees is an important issue.

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

During the year JM also offered its employees parenting seminars through Mentor.

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.

WELLNESS PROGRAM

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. Physical examinations are offered to all employees every other year and is JM's "fine-meshed net" for early identification of ill-health to be able to initiate interventions. Occupational health services provide physical examinations and employees prepare their health planning based on the results. In addition, we offer individual wellness programs and group wellness activities.

EMPLOYEES—GROUP	2010	2009	2008
Number of employees as of Dec. 31	2,100	1,850	2,365
– number of salaried employees	1,082	973	1,243
– number of wage-earners	1,018	877	1,122
Average age, salaried employees	42	45	43
Average age, wage-earners	39	42	40
Percentage of women among salaried
employees, %	31	31	34

AVERAGE NUMBER OF
EMPLOYEES BY COUNTRY	2010	2009	2008
Sweden	1,797	1,848	2,180
Norway	218	208	294
Denmark	11	17	31
Finland	6	7	12
Belgium	11	15	16
Total	2,043	2,095	2,533
ABSENCE DUE TO	2010	2009	2008

ILLNESS—SWEDEN, %
Total absence due to illness	3.6	3.6	4.3
29 years or younger	3.4	4.6	4.6
30–49 years	3.1	3.1	3.5
50 years and older	4.6	3.9	5.5
Absence due to illness during consecutive
period of at least 60 days/total absence	56	51	50
Women's sickness absence	2.5	2.3	2.4
Men's sickness absence	3.9	3.9	4.7

FOCUS ON EARLY REHABILITATION

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 evaluated. 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.

In 2010 total sickness absence at JM in Sweden was 3.6 percent (3.6) of regular working hours.

GOOD 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 9.7 (7.4) for both salaried employees and wage-earners. For wage-earners alone, the figure was 19.5 (15.8). The number of occupational accidents with at least one day of sickness absence in 2010 was 28 (21).

Employees at the site office at Sjöstadskajen, Hammarby Sjöstad.

Caroline has worked at JM for five years and at Liljeholmskajen in Stockholm since 2008. She started as foreman and is rather new in her role as site manager. Now she is in charge of two projects for a total of 177 apartments.

"The most important part of my job is to ensure that everyone is heading in the same direction and understands their areas of responsibility. And of course I have to make sure that we stick to the schedule and the budget, and that we build with the right quality," says Caroline.

JM is particularly careful with neatness and order at the construction site and ensuring that the workplace is safe and secure. For example, guard rails and safety lines must be in place and work properly. As site manager, Caroline is responsible for the work environment, but in daily work it is mainly

the foreman, team leaders and health and safety representatives who are in charge of safety.

Caroline welcomes JM's Structured Production project, which began in earnest in 2010 and is based on finding the best working methods for the different steps in production. The objective is for everyone to do things the same way. Right now she feels the most important part is finding a really good tool for feedback.

"JM has an employee policy that appeals to me," says Caroline. "The Company considers employees to be an asset and appreciates their skills. It feels like the Company is investing in a long-term relationship with its employees and providing them with opportunities for development on the job and through courses. I enjoy being out in the field and I face new challenges as site manager. Now I want to improve in this role and become a really good leader. After my years at JM I can say that women don't get any special treatment in a male-dominated industry. That's good, but of course people were extra solicitous when I was pregnant and stood with my big tummy at the top of the scaffolding."

Controlled risktaking essential for good profitability

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. These risks have been reduced during 2010.

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.

MACROECONOMIC RISKS

ECONOMIC GROWTH

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 21 percent for Sweden (Source: SCB, 2009).

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. During the latter part of 2009 and 2010 the housing markets where JM is active showed a positive trend as the macroeconomic situation improved.

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 lower interest rates during 2009 and 2010 influenced demand positively.

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.

JM tries to meet macroeconomic risks primarily by ensuring a clear demand for planned housing influenced demand positively. 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.

COMPETITIVE 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 RELATED TO BUILDING RIGHTS PORTFOLIO

At year-end 2010 JM had building rights corresponding to 27,500 residential units (27,900) 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 2010, about 9,900 building rights (9,500) 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 impairment.

Historically, JM has been successful in identifying and developing areas where people want to live. At the end of 2010, 82 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.

IMPLEMENTATION 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

Management of significant risks
Risk factor	Risk	Management
Significant interest rate hike Global economic downturn	Reduced demand, need for price reductions	Production does not start until a certain proportion of units in the project are 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 reductions, valuation	Strategic acquisition planning
not optimized	of building rights	Business environment monitoring and market analysis
		Continuous evaluation of asset structure
Pre-construction not simultaneously	Reduced demand, need for price reductions	Market analysis, high-quality extensive surveys
focusing on customer values, revenues and expenses		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 custom ers means lower sales and fewer housing starts	Long-term relationships and close collaboration with banks and other financing institutions

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 or, for large projects, by the Board. For more information see page 89, 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-owners 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 2010, JM held 40 unsold units (110) for a value of SEK 115m (353) on the balance sheet, which indicates a very low risk for unsold units. 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 66.

COST CONTROL AND INTERNAL OVERSIGHT

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 SEK 5.3bn for 2010.

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 analysis, various cost categories, project developmenthousing

Category	Share of costs, %1)	Change, %	Effect, SEKm
Salaries/wages	14	+/–10	+/– 76
Material	16	+/–10	+/– 85
Land	16	+/–10	+/– 86
Developer's costs	14	+/–10	+/– 73
Pre-construction	5	+/–10	+/– 26
Overhead	6	+/–10	+/– 33
Subcontracting	29	+/–10	+/– 149

1) Share of cost base, project development of housing in Sweden was SEK 5.3bn 2010.

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.

FINANCIAL POLICY

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, but has improved significantly during 2010. Today, financing of housing production is not a problem and can be regarded as normalized.

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.

27,500 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 7.0 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 about SEK 1,200m, or just over SEK 14 per share according to the basis for this calculation.

The sensitivity analysis below excludes cash flows from previously recognized land (SEK 5,314m) after adjustment of liabilities for property acquisitions (SEK 508m). The present value of these cash flows amounts to about SEK 2.6bn.

Sensitivity analysis, present value, SEKm for JM'S building rights portfolio for housing

Revenue/m2, SEK	25,000	26,000	27,000	28,000	29,000
Cost/m2 , SEK
20,000	5,800	7,000	8,200	9,400	10,600
21,000	4,600	5,800	7,000	8,200	9,400
22,000	3,500	4,600	5,800	7,000	8,200
23,000	2,300	3,500	4,600	5,800	7,000
24,000	1,200	2,300	3,500	4,600	5,800

Sensitivity analysis, present value, SEK/share for JM's building rights portfolio for housing

Revenue/m2, SEK	25,000	26,000	27,000	28,000	29,000
Cost/m2 , SEK
20,000	70	84	99	113	127
21,000	55	70	84	99	113
22,000	42	55	70	84	99
23,000	28	42	55	70	84
24,000	14	28	42	55	70

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	71
balance sheet–parent company	72
statement of changes in equity–parent company	73
notes–parent company	73
five-year overview–group	76
quarterly overview–group	78
quarterly overview–business segments	79
Ifric 15	80
proposed disposition of earnings	82
auditors' report	83
definitions and glossary	84

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 2010.

MARKET , SALES AND HOUSING STARTS

Demand for newly built homes continues to be good in JM's main markets in Sweden and Norway, while demand in Denmark has improved somewhat over the past year. Sales have continued to be good. The improved economy and population growth in our main markets, coupled with continued low interest rates, support demand for housing.

The number of residential units sold in the form of signed contracts was 3,276 (3,291), of which 211 (562) involve rental project in Stockholm for external client.  The percentage of sold or reserved homes in relation to current production amounts to 82 percent (79), with an interval of 60–65 percent considered normal. The business segment JM Residential Stockholm sold 1,408 (1,713) residential units, JM Residential Sweden sold 1,207 (973) and JM International 661 (605).

The number of housing starts rose to 3,404 (2,150), including 1,604 (1,102) in the Stockholm area and 1,230 (689) elsewhere in Sweden. Housing starts in international operations totaled 570 (359). Residential housing starts include 211 rental units (492) in Stockholm for external clients. The rate at which housing starts increase depends on the ability to ensure arrangements to allocate resources to handle larger production volumes, with new employees being hired according to plan. The number of residential units in current production amounts to 5,431 (3,744).

INCOME

Consolidated revenue for the year was SEK 9,136m (9,620), including an impact on revenue of SEK –138m (842) due to restatement according to IFRIC 15. Revenue according to segment accounting shows an increase for 2010 of SEK 496m (–3,451). The increased revenue is mainly attributable to the business segments JM Residential Stockholm and JM Residential Sweden, with more housing starts during the past year.

OPERATING PROFIT

Consolidated operating profit for 2010 increased to SEK 907m (646) and the operating margin increased to 9.9 percent (6.7). Restatement according to IFRIC 15 had an impact on profit of SEK –62m (–18). The improvement in earnings and margin is due to the higher level of sales and housing starts during the past year and a higher price level for the projects. During the year properties sold for SEK 80m (665) with gains of SEK 28m (89). Rental income from JM's project properties totaled SEK 62m (69), with residential units accounting for SEK 0m (6). Net operating income was SEK 11m (0). The result for 2009 included an impairment loss of SEK 87m for development properties.

Operating income for the business segment JM Residential Stockholm increased to SEK 634m (496). The result includes about SEK 30m attributable to two divestments of properties in ongoing projects. The improvement in earnings and margin is due to the higher level of housing starts during the past year and a higher price level for the projects.

Operating profit for JM Residential Sweden increased to SEK 219m (166) and the operating margin increased to 8.0 percent (7.2). The improved margin is mainly attributable to higher prices in the projects.

Operating profit for JM International improved to SEK 48m (–192) and operating margin improved to 3.1 percent (–14.2). The result for 2009 included an impairment loss of SEK 87m for development properties. The improvement in profit and operating margin can be attributed to better demand, increased project volume and a more stable market.

Operating profit for JM Property Development declined to SEK 12m (110). The reduction is due to a lower volume of activity since the office project in Frösunda, with Vasakronan as the client, was completed at the beginning of the year and lower gains from property sales.

Operating profit for JM Production declined to SEK 91m (130) and operating margin totaled 6.1 percent (6.5). Profit was lower due to lower project volumes during the year.

BUSINESS SEGMENT		Income		Operating profit 1)		Operating margin, %
SE Km	2010	20092)	2010	20092)	2010	20092)
JM Residential Stockholm	3,824	3,330	634	496	16.6	14.9
JM Residential Sweden	2,749	2,296	219	166	8.0	7.2
JM International	1,570	1,353	48	–192	3.1	–14.2
JM Property Development	72	309	12	110
JM Production	1,496	2,008	91	130	6.1	6.5
Elimination	–437	–518	-	-
Group-wide expenses	-	-	–35	–46
Total as stated in segment reporting	9,274	8,778	969	664
Restatement JM ­ International 3)	–138	842	–62	–18
Total	9,136	9,620	907	646	9.9	6.7
1) Including impairment losses on properties			-	–87

2) Comparative figures were restated due to the changed accounting principles regarding revenue recognition in JM International.

3) Effect of restatement on income and profit and loss according to IFRIC 15 in relation to segment reporting.

RESIDENTIAL UNITS IN CURRENT PRODUCTION

		Dec. 31, 2010 Dec. 31, 2009
Number of residential units in current production 1)	5,431	3,744
Percentage sold residential units in current production, %2)	64	54
Percentage reserved residential units in current production, %	18	25
Percentage sold and reserved residential units in current production, %	82	79

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, 2010 Dec. 31, 2009
Completed production, number of unsold units 1)	44	146
– Including the balance sheet item reported as "Participations in tenant-owners associations, etc."	40	110

1) After final occupancy according to plan.

FINANCIAL INCOME AND EXPENSES

Financial income and expenses totaled SEK –67m (–117), an improvement of SEK 50m compared with the previous year, mainly due to lower interest-bearing debt and lower interest rates. Financial income and expenses during the year are largely related to revaluation and currency hedging of claims on JM International with a net effect on net interest income of SEK –1m (2). Financial income for the year includes income from the sale of shares in associated companies of SEK 5m (0).

SEKm		Dec. 31, 2010 Dec. 31, 2009
Financial income 1)	51	41
Finance expenses 2)	–118	–158
Financial income and expenses	–67	–117
1) Including revaluation and currency hedging	32	29
2) Including revaluation and currency hedging	–33	– 27

prOFIT BEFORE TAX

Net profit before taxes increased to SEK 840m (529), an increase of 59 percent compared with 2009.

PROFIT FOR THE YEAR

Profit for the year was SEK 594m (365). Total tax expense was SEK –246m (–164) including current tax of SEK –220m (–161) and deferred tax of SEK –26m (–3). Tax expense for 2010 exceeds the nominal tax rate for the Group, which is primarily explained by the revaluation of deferred tax relating to a losscarryforward in JM International. A charge of SEK 24m (24) was taken against earnings for the property tax, which is treated as an operating expense.

OPERATIONS

BUILDING RIGHTS

JM's available building rights total 27,500 residential units (27,900), including 17,600 residential units (18,400) recognized on the balance sheet. This means that 9,900 building rights (9,500) 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 increased to SEK 5,314m (4,882) at year-end. In addition the JM Property Development business segment has access to building rights for commercial project development, including 225 building rights for rentals, equivalent to about 60,000 square meters with a total carrying amount of SEK 60m (108).

TOTAL NUMBER OF RESIDENTIAL BUILDING RIGHTS (Including rights carried in the balance sheet as development properties)

	2010		2009
JM Residential Stockholm	11,100	(7,100)	10,700	(7,500)
JM Residential Sweden	9,600	(6,100)	10,200	(6,500)
JM International	6,800	(4,400)	7,000	(4,400)
Total	27,500	(17,600)		27,900 (18,400)

Valuation of JM's total development properties with a carrying amount of SEK 5.4bn (5.0), including commercial building rights of SEK 0.1bn (0.1), indicates a surplus value of SEK 2.6bn (1.9). This valuation was carried out in cooperation with an independent appraisal company. During 2010 JM acquired development properties for a total of SEK 1,655m (428), of which SEK 960m relates to JM Residential Stockholm, SEK 328m to JM Residential Sweden and SEK 367m to JM International. Net investment in development properties during the year was SEK 523m (–613), after which holdings of building rights amount to SEK 5,374m (4,990). These holdings are essential for JM's residential development projects.

DEVELOPMENT PROPERTIES (HOUSING )

	Dec. 31, 2010		Dec. 31, 2009
SE K billion	Market value	Carrying amount	Market value	Carrying amount
JM Residential Stockholm	4.3	2.6	3.2	2.1
JM Residential Sweden	2.0	1.5	1.9	1.5
JM International	1.6	1.2	1.7	1.3
Total	7.9	5.3	6.8	4.9

PRO JECT PROPERTIES

Rental income from JM's project properties totaled SEK 62m (69), with residential properties accounting for SEK 0m (6). Net operating income was SEK 11m (0). In 2010 JM sold properties for a total of SEK 80m (665) with a capital gain of SEK 28m (89). The gains include SEK 17m (28) relating to the reversal of provisions from previous property sales. During the year a major property sale was carried out; the development property Signalen in Solna was sold for SEK 35m with gains of SEK 7m. An external appraiser calculated the market value of JM's project properties to be SEK 685m (610) with a carrying amount of SEK 661m (596). The surplus value is therefore SEK 24m (14).

PROJECT PROPERTIES

				Occupancy
Dec. 31, 2010	Market value, SE Km	Carrying amount, SE Km	Area (000) m2	rate annual rent, %
Properties under development	541	530	58	88
Fully developed commercial properties 144		131	7	98
Total	685	661	65	89

Investments and acquisition of project properties totaled SEK 74m (453).

INTEREST-BEARING LIABILITIES AND AVERAGE INTEREST RATES

As at December 31, 2010, interest-bearing net receivables amounted to SEK 730m (189). At year-end non interestbearing liabilities for implemented property acquisitions amounted to SEK 453m (228). Of these liabilities SEK 236m (116) were short-term. The total interest-bearing loan as of December 31, 2010 was SEK 1,357m (1,842), of which the provision for pensions comprised SEK 585m (565). At yearend the average interest rate for the total loan stock, including pension liabilities, was 3.6 percent (4.0). The average fixedinterest period for the Group's loan stock, excluding the pension liability, was 0.2 years (0.3).

CASH FLOW

Cash flow from operating activities during the year was SEK 42m (1,124) after payment of SEK 719m during the second quarter, with SEK 690m attributable to JM Residential Stockholm and SEK 29m to JM Property Development, relating to the previous acquisition of the Dalénum area on Lidingö, Stockholm. Net investments in development properties, excluding payment for Dalénum, resulted in a cash flow of SEK –277m (427). Decreased holdings of unsold residential units on the balance sheet contributed SEK 270m (–187). Consolidated cash flow from project properties (sales minus investment) during the year was SEK –73m (532).

LIQUIDITY

The Group's available liquidity was SEK 4,887m (4,830). Aside from cash and cash equivalents of SEK 2,087m (2,030) 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 1.7 years.

EQUITY

Consolidated shareholders' equity as at December 31, 2010 totaled SEK 3,923m (3,637). Share capital totaled SEK 83m (83), other paid-up capital SEK 766m (763), and reserves SEK –20m (85). Undistributed earnings totaled SEK 3,094m (2,706) including profit for the year of SEK 594m (365). In 2010 the dividend to shareholders was SEK 2.50 per share (0), for a total of SEK 208m (0). The equity ratio was 40 percent (37).

Personnel

The number of employees increased during 2010 by 14 percent and at year-end amounted to 2,100 (1,850). The number of employees is increasing according to plan in order to handle growth in production volume. The number of wage-earners was 1,018 (877) and the number of white collar employees 1,082 (973). The average number of employees during the year was 2,043 (2,095) including 246 (247) employed in JM's foreign subsidiaries.Wages, salaries, and social security expenses totaled SEK 1,392m (1,427), of which social security expenses comprised SEK 468m (458).

ENVIRONMENTAL WORK

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 our operations system, 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. For more information, please see the "Sustainable urban planning" section on pages 28–33.

WORK OF THE BOARD IN 2010

The 2010 Annual General Meeting elected seven ordinary members. The employee organizations have appointed two employee representatives and two deputies. The Board of Directors held twelve meetings. In addition the Audit Committee held four meetings, the Compensation Committee six meetings and the Investment Committee seven meetings. The most important issues for the Board during 2010 were decisions to start production on large housing projects, major acquisitions of development properties, and the strategic plan, as well as proposals for long-term variable salary program and proposal for convertible debenture and option program for all personnel in the Group. During the year the Board of Directors implemented an incident reporting system to deal with incidents systematically and professionally. The Board members' participation in meetings can be seen in the chart on page 86. 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 page 87.

DIVIDEND

For 2010 the Board of Directors proposes a dividend of SEK 4.50 (2.50) per share, for a total of SEK 375m (208). The dividend rate is justified by good earnings combined with a strong balance sheet. The proposed record date for the dividend is Tuesday, May 3, 2011. If the Annual General Meeting resolves to adopt the recommendation the dividend will be sent on Friday, May 6, 2011.

SHARE CAPITAL

On December 31, 2010 JM's share capital amounted to SEK 83m, represented by 83,401,883 shares, including 164,825 repurchased shares. All shares carry equal voting rights and equal rights to a share of the Company's equity. The issued shares are freely transferable with no restrictions imposed by law or by JM's Articles of Association. JM knows of no agreements involving shareholders that may restrict the right to transfer shares.

REMUNERATION TO SENIOR EXECUTIVES

The Board of Directors' proposal for resolutions on guidelines for salary and other remuneration to senior executives can be seen below and will be presented at the Annual General Meeting for approval. The guidelines are the same as those adopted at the 2010 Annual General Meeting. The new agreements with senior executives since the 2010 Annual General Meeting have followed the guidelines that are in effect. A few senior executives have older agreements entitling them to retirement at age 60; please see note 3, Employees and personnel costs, page 60.

PROPOSAL FOR 2011 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 will consist of fixed salary, short and long-term variable salary programs, pension benefits and other benefits.

"Other senior executives" refers to the 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 program 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. Long-term variable salary program can be equity 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 2010 for the Parent Company amounted to SEK 6,553m (5,990). The Parent Company's profit before appropriations and tax was SEK 627m (455). Investments in properties totaled SEK 612m (237). The average number of employees was 1,349 (1,337), including 1,110 men (1,073) and 239 women (264). Wages, salaries, and social security expenses totaled SEK 928m (936). An account of the number of employees and payroll expenses is provided in the Parent Company's notes, note 2, page 73.

During the year the following wholly owned Group companies were merged into the Parent Company: Förvaltnings AB Gnarpen, Kvarnexet 1 AB, Kvarnexet 5 AB, Milud AB, Projektmäklarna AB and TG Betongarbeten Produktion AB.

The mergers did not have a substantial effect on the Parent Company's profit and position.

CONSOLIDATED INCOME STATEMENT , SEKm	Note	2010	20091)
Income	1 2	9,136	9,620
Production and operating costs	3, 4	–7,608	–8,361
Gross profit		1,528	1,259
Selling and administrative expenses	3, 4, 5	–649	–615
Gains on the sale of properties	6	28	89
Impairment losses on properties	7	-	–87
Operating profit	2	907	646
Financial income	8	51	41
Financial expenses	8	–118	–158
Profit before tax		840	529
Taxes	9	–246	–164
Profit for the year		594	365
Other comprehensive income
Translation differences		–105	41
Comprehensive income for the year		489	406
Profit for the year attributable to:
Shareholders of the Parent Company		594	365
Comprehensive income for the year attributable to:
Shareholders of the Parent Company		489	406
Earnings per share, basic and diluted, attributable to
shareholders of the Parent Company (SEK)	10	7.10	4.40
Proposed dividend per share (SEK)	10	4.50	2.50

1) Comparative figures were restated due to the changed accounting principles regarding revenue recognition in JM International. For more information about IFRIC 15, please see the accounting principles on pages 54–57 and the tables that show the effects of restatement on pages 80–81.

INCOME

(2010: SEK 9,136m, 2009: SEK 9,620m) Consolidated revenues during the year decreased 5 percent to SEK 9,136m (9,620). Restatement according to IFRIC 15 relating to JM International had an impact on revenue of SEK –138m (842). The Group applies IFRIC 15 Agreements for the Construction of Real Estate for its income statement commencing in 2010. IFRIC 15 only changes reporting of revenue and profit and loss for JM's operations outside Sweden, JM International. Income from the Swedish operations 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

(2010: SEK 907m, 2009: SEK 646m)

Operating profit was up 40 percent to SEK 907m. The improvement in earnings is due to the higher level of sales and housing starts in 2010 and a more favorable market assessment. Restatement according to IFRIC 15 had an impact on profit of SEK –62m (–18).

FINANCIAL INCOME AND EXPENSES

NOTES

(2010: SEK –67m, 2009: SEK –117m) Net financial items improved by SEK 50m compared with the previous year. Financial expenses decreased mainly due to lower fixed income liabilities and lower interest rates. Financial income for the year includes income from the sale of shares in associated companies of SEK 5m (0). Revaluation and currency hedging of claims on JM International had a net effect on net interest income of SEK –1m (2).

TA XES

(2010: SEK –246m, 2009: SEK –164m)

Reported tax expense is 29 percent in 2010, compared with 31 percent for 2009. The difference between reported tax and the nominal tax rate for both 2010 and 2009 is primarily attributable to the revaluation of deferred tax relating to a loss-carryforward and temporary differences within JM International.

INCOME BY BUSINESS SEGMENT

CONSOLIDATED BALANCE SHEET , SEKm	Note	Dec 31, 2010	Dec 31, 20091)	Jan 1, 20091)
	1
ASSETS	2
Non-current assets
Goodwill	11	58	62	56
Machinery and equipment	12	12	18	21
Participations in associated companies	13, 14	9	12	6
Interest-bearing financial assets	15	1	1	11
Other financial assets	15, 16	63	70	10
Deferred tax assets Total non-current assets	27	76 219	96 259	83 187
Current assets
Project properties	17	661	596	614
Development properties	17	5,374	4,990	5,620
Participations in tenant-owners associations, etc.	18	115	353	171
Accounts receivable	24	444	385	507
Other current receivables	19	413	347	874
Prepaid expenses and accrued income		14	3	15
Recognized revenue less progress billings	20	449	652	682
Work in progress	21	117	272	243
Cash and cash equivalents	22	2,087	2,030	1,111
Total current assets		9,674	9,628	9,837
TOTAL ASSETS		9,893	9,887	10,024
EQUITY AND LIABILITIES	2
Equity attributable to shareholders of
the Parent Company 2)
Share capital		83	83	83
Additional paid in capital		766	763	760
Reserves		–20	85	44
Undistributed earnings (including profit for the year)		3,094	2,706	2,338
Total shareholders' equity		3,923	3,637	3,225
Liabilities
Non-current liabilities
Non-current interest-bearing liabilities	23, 24	258	326	314
Other non-current liabilities	23, 24	218	113	271
Provisions for pensions and similar commitments	25	585	565	513
Other non-current provisions	26	207	185	166
Deferred tax liabilities	27	1,041	932	897
Total non-current liabilities		2,309	2,121	2,161
Current liabilities
Accounts payable	23, 24	466	365	497
Current interest-bearing liabilities	23, 24	514	951	1,137
Other current liabilities	23, 24	473	471	414
Current tax liabilities		123	77	17
Progress billings in excess of recognized revenue	28	1,214	1,314	1,571
Accrued expenses and deferred income	29	760	818	890
Other current provisions	26	111	133	112
Total current liabilities		3,661	4,129	4,638
Total liabilities		5,970	6,250	6,799
TOTAL EQUITY AND LIABILITIES		9,893	9,887	10,024
Pledged assets and contingent liabilities	30

1) Comparative figures were restated due to the changed accounting principles regarding revenue recognition in JM International. For more information about IFRIC 15, please see the accounting principles on pages 54–57 and the tables that show the effects of restatement on pages 80–81.

2) Please see the section on Consolidated statement of changes in equity, page 52.

CONSOLIDATED CAPITAL STRUCTURE Dec. 31, 2010 Shareholders' equity 40% (37) Other non-current liabilities 2% (1) Provisions for pensions 6% (6) Progress billings in excess of recognized revenue/work in progress 12% (13) Interest-bearing liablilities 8% (13) Other liabilities and provisions 32% (30) CONSOLIDATED ASSETS Dec. 31, 2010 Project properties 7% (6) Development properties 54% (50) Other current receivables 4% (4) Recognized revenue less progress billings/work in progress 6% (10) Cash and cash equivalents 21% (20) Other assets 8% (10)

RETURN ON EQUITY AND CAPITAL EMPLOYED2)

1) Comparative figures were restated due to the changed accounting principles regarding revenue recognition in JM International. For more information about IFRIC 15, please see the accounting principles on pages 54–57 and tables that show the effects of restatement on pages 80–81.

2) Financial year 2008 and earlier are not restated according to IFRIC 15.

PROJECT PROPERTIES

(2010: SEK 661m, 2009: SEK 596m) The portfolio of project properties is somewhat larger

than the previous year. No property sales were carried out in 2010. How-

ever, reversals of provisions from previous property sales had an effect on earnings of SEK 17m.

DEVELOPMENT PROPERTIES

(2010: SEK 5,374m, 2009: SEK 4,990m) In 2010 JM acquired development properties at a higher pace than the previous year. During the year JM acquired development properties for SEK 1,655m (428), while development properties for SEK 1,080m (910) were transferred to production. All acquisitions involve development properties intended for housing and relate mainly to properties on Lidingö, by Brommaplan and in Gothenburg. During the year JM sold development properties for SEK 63m with gains of SEK 11m. The largest transaction involved the development property Signalen in Solna, which was sold for SEK 35m with gains of SEK 7m. In all, JM has 17,600 building rights (18,400) on the balance sheet.

NOTES

PARTICIPATIONS IN TENANT-OWNERS ASSOCIATIONS ETC.

(2010: SEK 115m, 2009: SEK 353m)

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 40 (110), of which 0 homes (56) pertain to the Egholm project in central Copenhagen.

RECOGNI ZED REVENUE LESS PROGRESS BILLINGS

(2010: SEK 449m, 2009: SEK 652m)

During the year improved opportunities for financing resulted in improved project financing.

WOR K IN PROGRESS

(2010: SEK 117m, 2009: SEK 272m)

The balance sheet item "work in progress" was added due to the changed accounting principle relating to JM's operation outside Sweden, JM International. This item was previously included under the heading "recognized revenue less progress billings." In work in progress, projects that have not been turned over to customers and where revenues and expenses may not be recognized in the income statement according to IFRIC 15 are capitalized in the JM Group's consolidated balance sheet. Work in progress decreases in scope due to improved financing opportunities.

NON-CURRENT INTEREST-BEARING LIABILTIES

(2010: SEK 258m, 2009: SEK 326m)

Non-current interest-bearing liabilities decreased somewhat since the convertible loan relating to the 2007 program for SEK 142m was reclassified from noncurrent to current liability and the new convertible loan for the 2010 program is recognized at a lower amount, SEK 32m. Non-current interest-bearing promissory notes increased from SEK 15m to SEK 55m.

CURRENT INTEREST-BEARING LIABILITIES (2010: SEK 514m, 2009: SEK 951m)

Current interest-bearing promissory notes relating to the Dalénum area were settled during the year in the amount of SEK 719m. The convertible loan for the 2007 convertible program will be settled in 2011 and therefore the liability has been reclassified from non-current to current interest-bearing liability.

OTHER NON-CURRENT LIABILITIEs

(2010: SEK 218m, 2009: SEK 113m)

Other non-current liabilities increased during the year because JM financed several major acquisitions of development properties with deferred payment.

CONSOLIDATED CASH FLOW STATEMENT , SEKm Note	2010	2009
1
OPERATING ACTIVITIES
Operating profit	907	646
Depreciation	7	13
Impairment losses	-	87
Adjustment for non-cash items	–34	–39
Sub-total, cash flow from operating activities	880	707
Interest received	40	11
Dividends received	2	2
Interest paid and other financial expenses	–74	–132
Repaid/paid tax	–194	73
Cash flow from operating activities before change
in working capital	654	661
Investment in development properties etc.	–2,399	–2,154
Payment on account for development properties etc.	1,673	2,395
Increase/decrease in accounts receivable	–59	122
Increase/decrease in other current receivables, etc.	283	–8
Increase/decrease in accounts payable	102	–132
Increase/decrease in other current operating liabilities	–139	–292
Cash flow before investments and sales of
project properties	115	592
Investment in project properties etc.	–73	–366
Sale of project properties etc.	0	898
Cash flow from operating activities	42	1,124
INVESTING ACTIVITIES Investment in property, plant, and equipment	–3	–9
Property, plant, and equipment sold	0	1
Change in financial assets	10	–43
Cash flow from investing activities	7	–51
FINANCING ACTIVITIES
Loans raised	423	462
Amortization of debt	–202	–620
Dividend	–208	-
Cash flow from financing activities	13	–158
Cash flow for the year	62	915
Cash and cash equivalents, January 1	2,030	1,111
Exchange rate difference in cash and cash equivalents	–5	4
Cash and cash equivalents, December 31	2,087	2,030
23 INTEREST -BEARING NET LIABILITIES / RECEIVABLES
Interest-bearing liabilities and provisions	1,357	1,842
Cash and cash equivalents	–2,087	–2,030
Interest-bearing receivables	0	–1
Interest-bearing net liabilities (+)/receivables (–) at year-end	–730	–189

OPERATING ACTIVITIES

(2010: SEK 42m, 2009: SEK 1,124m)

Cash flow from operating activities decreased to SEK 42m (1,124) after payment of SEK 719m during the second quarter relating to the previous acquisition of the Dalénum area on Lidingö and increased investments in development properties.

Cash flow from operating activities (sub-total) (2010: SEK 880m, 2009: SEK 707m)

Operating activities, before interest and tax, contributed SEK 880m (707). This represents an improvement of SEK 173m after adjustment for gains on property sales of SEK 28m, reported under the sale of each type of property, and elimination of non-cash items.

Cash flow from operating activities improved compared with the previous year because of more project starts.

NOTES

Cash flow from operating activities before change in working capital

(2010: SEK 654m, 2009: SEK 661m)

Net interest received and paid decreased from SEK –119m in 2009 to SEK –32m in 2010, attributable in part to lower total interest-bearing liability in 2010. Realized exchange rate gains on the sale of hedged loans made a positive contribution.

Taxes repaid/paid decreased from SEK 73m in 2009 to SEK –194m in 2010.

Net development properties etc. (including participations in tenant-owners associations)

(2010: SEK 726m, 2009: SEK 241m)

JM invested in new development properties for SEK 1,655m (428). At the same time, SEK 1,080m (910) went into production in conjunction with project starts. During the year the Group decreased its holdings of participations in tenant-owners associations with a positive net flow of SEK 270m (–187).

Current receivables and liabilities

(2010: SEK 187m, 2009: SEK –310m) The change in current receivables and liabilities had a positive effect on cash flow of SEK 497m (–497) compared with the previous year.

Net project properties

(2010: SEK –73m, 2009: SEK 532m)

The Group only made minor investments during the year for projects such as senior housing, at the same time that sales made did not generate cash flow, which together explain the negative flow.

FINANCING ACTIVITIES

(2010: SEK 13m, 2009: SEK –158m) Cash flow from operating activities was for purposes such as shareholder dividends of SEK –208m. Interestbearing liabilities increased net by SEK 221m, mainly due to increased borrowing within foreign operations.

ADJUSTMENT FOR NON -CASH ITEMS	2010	2009
Gains on the sale of properties	–28	–89
Changes in pension liability	20	52
Other provisions etc.	–26	–2
Total	–34	–39
INVESTMENTS IN DEVELOPMENT PROPERTIES , ETC	2010	2009
Investment in development properties	–1,655	–428
Acquisition of participations in tenant-owners associations	–325	–1,519
Change in promissory note	–419	–207
Total	–2,399	–2,154
PAYMENT ON ACCOUNT FOR DEVELOPMENT PROPERTIES , ETC	2010	2009
Payment on account for development properties	1,080	910
Sale of development properties	63	133
Change in receivables, development properties sold, etc.	–12	16
Sale of participations in tenant-owners associations	542	1,336
Total	1,673	2,395
INVESTMENT IN PRO JECT PROPERTIES , ETC	2010	2009
Investment in project properties	–74	–453
Change in promissory note	-	79
Adjustment for capitalized interest	1	8
Total	–73	–366
SALE OF PRO JECT PROPERTIES , ETC	2010	2009
Sale of project properties	0	532
Changes in receivables	0	366
Total	0	898

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY , SEKm	Share capital	Additional paid in capital	Translation reserves	Undistributed earnings	Total share holders' equity
Opening balance, January 1, 2009 Effect of change in accounting principle,	83	760	44	2,354	3,241
IFRIC 15	-	-	-	–16	–16
Adjusted opening balance	83	760	44	2,338	3,225
Comprehensive income for the year	-	-	41	365	406
Equity component of convertible debentures	-	3	-	-	3
Share-based payments regulated with equity instruments	-	-	-	3	3
Closing balance, December 31, 2009	83	763	85	2,706	3,637
Opening balance, January 1, 2010	83	763	85	2,706	3,637
Comprehensive income for the year	-	-	–105	594	489
Dividend to equity holders of the Parent Company	-	-	-	–208	–208
Equity component of convertible debentures Share-based payments regulated with	-	3	-	-	3
equity instruments	-	-	-	2	2
Closing balance, December 31, 2010	83	766	–20	3,094	3,923

Attributable to shareholders of the Parent Company

EQUITY

(2010: SEK 3,923m, 2009: SEK 3,637m) Shareholder's equity increased by SEK 286m compared with the outcome of 2009. Consolidated equity as at December 31, 2010, totaled SEK 3,923m (3,637), which corresponds with SEK 47 (44) per share. Return on equity is 15.7 percent (10.6).

Comprehensive income for the year

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

Translation difference

The change for the year amounts to SEK –105m (41) and the accumulated translation difference in closing equity is SEK –20m (85). The appreciation of the Swedish krona entailed a negative impact on translation difference for the year in shareholders' equity, with SEK 35m against the Norwegian krona, SEK 33m against the Danish krona and SEK 37m against the Euro.

NOTES

Dividend to equity holders of

the Parent Company

The dividend to equity holders of the Parent Company totaled SEK 208m (0), corresponding with SEK 2.50 (0) per share.

Equity component of convertible debentures

Convertible debentures were offered to JM employees during the year. 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 2m.

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

Share capital

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

Other paid-up capital

Other paid-up 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
NOTE 1	ACCOUNTING AND VALUATION PRINCIPLES	54
NOTE 2	Segment information	57
NOTE 2	CONSOLIDATED INCOME STATEMENT BY ­SEGMENT	58
NOTE 2	CONSOLIDATED balance sheet BY ­SEGMENT	59
NOTE 3	EMPLOYEES AND PERSONNEL COSTS	60
NOTE 4	DEPRECIATION ACCORDING TO PLAN	62
NOTE 5	FEES AND REMUNERATION TO AUDITORS	62
NOTE 6	GAINS ON THE SALE OF PROPERTIES	62
NOTE 7	impairment losses on properties	62
NOTE 8	FINANCIAL INCOME AND EXPENSES	62
NOTE 9	TA XES	62
NOTE 10	EARNINGS AND DIVIDEND PER SHARE	63
NOTE 11	Goodwill	63
NOTE 12	machinery AND EQUIPMENT	63
NOTE 13	PARTICIPATIONS IN ASSOCIATES	64
NOTE 14	PARTICIPATIONS IN ASSOCIATES	64
NOTE 15	FINANCIAL ASSETS	64
NOTE 16	PARTICIPATIONS IN GROUP COMPANIES	65
NOTE 17	PRO JECT PROPERTIES AND DEVELOPMENT ­PROPERTIES	66
NOTE 18	PARTICIPATIONS IN TENANT -OWNERS ­ASSOCIATIONS ETC	66
NOTE 19	OTHER CURRENT RECEIVABLES	66
NOTE 20	RECOGNI ZED REVENUE LESS PROGRESS ­BILLINGS	66
NOTE 21	WOR K IN PROGRESS	66
NOTE 22	CASH AND CASH EQUIVALENTS	66
NOTE 23	FINANCIAL LIABILITIES	67
NOTE 24	FINANCIAL RIS K MANAGEMENT AND ­FINANCIAL DERIVATIVE INSTRUMENTS	67
NOTE 25	PROVISIONS FOR PENSIONS AND SIMILAR ­COMMITMENTS	69
NOTE 26	OTHER PROVISIONS	69
NOTE 27	DEFERRED TAX ASSETS AND LIABILITIES	70
NOTE 28	proGRESS BILLINGS IN EXCESS OF­RECOGNI ZED REVENUE	70
NOTE 29	ACCRUALS AND DEFERRED INCOME	70
NOTE 30	PLEDGED ASSETS AND CONTINGENT ­LIABILITIES	70
NOTE 31	RELATED PARTY DISCLOSURES	70

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 22 and will be presented for adoption at the 2011 Annual General Meeting. JM AB is a Swedish public limited company listed on NASDAQ OMX 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 (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 (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 2010 remain unchanged compared with 2009 with the exceptions described below.

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

JM has applied IFRIC 15 Agreements for the Construction of Real Estate since January 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 concerns 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 continues to be applied. From January 2010, JM applies IAS 18 Revenue for residential development projects outside Sweden. This entails certain effects at restatement of the comparative income statement and balance sheet for 2009. The JM Group's restated operating profit for 2009 is reduced by about SEK 20m and equity as at Dec. 31, 2009, is reduced by about SEK 30m. As in the Swedish business, segment accounting and project management of JM's foreign operations continue to be carried out 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.

According to revised IAS 27, changes in the parent companies ownership in subsidiary 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.

Changes in effect commencing in 2011

New and changed accounting standards and interpretations that apply from 2011 are extremely limited in scope and are not assessed to have any effect on JM's financial reports.

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 definedbenefit 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 "Impairment losses" 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 International, JM Property Development and JM Production, 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 areas combined with differences between products and services provided. The CEO regularly uses internal reporting from the business segments to allocate resources to the segments and to assess the performance of the segments.

Segment reporting of JM's operations regarding residential development projects both in Sweden and outside Sweden remains unchanged and is reported in compliance with IAS 11, percentage of completion method.

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 in the Swedish operations are reported in compliance with IAS 11 Construction Contracts (the percentage of completion method). Revenue is based on stage of completion and profit is calculated based on stage of completion multiplied by the sales rate. Sales rate reflects the obligation to acquire unsold residential units. The adjustment for the obligation decreases as the number of unsold residential units in each project decreases.

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 and sale, 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 tenantowned/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.

JM applies IAS 18 Revenue for residential development projects outside Sweden. Revenue and profit are usually reported at the time the home is transferred to the customer.

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.  An impairment loss 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 impairment losses, 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.

Note 1 cont.

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 should 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 project 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.

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.

Impairment losses

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 greater of net realizable value 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 definedbenefit. Obligations and costs relating to definedbenefit 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 mortgage 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 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 25. Independent actuaries conduct annual calculations relating to the defined-benefit plans found at JM. 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 long-term 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 a certain number of contribution shares the participant is granted the right to acquire one ordinary JM share (performance share) at an established redemption price. 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 for a specific period of time 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.

Convertible debentures

Convertible debentures are reported as a compound financial instrument comprising a liability component and an equity component. The fair value of the liability at issuance is calculated by discounting future cash flows using the current market interest rate for an equivalent liability. The value of the equity instrument is calculated as the difference between the issue proceeds and the fair value of the financial liability. The equity instrument comprises an embedded option to convert the liability into shares.

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 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 are classified as cash and bank balances. Cash and cash equivalents include short-term investments with a maturity of less than three months from the due 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 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 develops 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 custom-

ers 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 segment and business concept.

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 profit or loss. 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 financial expenses, financial income and income taxes are mainly handled at Group level and not allocated to segments.

Transactions between business segments are based on market conditions.

Note 2 cont.

CONSOLIDATED INCOME STATEMENT BY BUSINESS SEGMENT

											Restate
		JM	JM							Unal	ment
	JM	Residen	Property	JM	Elimina	Sub	JM	Group	Sub	located	JM
	Residential	tial	develop	Produc	tions	total	Interna	wide	total	items	Interna	Total
Group 2010	Stockholm	Sweden	ment	tion	Sweden	Sweden	tional	expenses	Group	Group2)	tional 3)	Group
Revenues – external	3,824	2,749	72	1,059	-	7,704	1,570	-	9,274	-	–138	9,136
Revenues – internal	-	-	-	437	–437	-	-	-	-	-	-	-
Total revenues	3,824	2,749	72	1,496	–437	7,704	1,570	-	9,274	-	–138	9,136
Production and operating costs 1)	–2,957	–2,375	–56	–1,346	437	–6,297	–1,387	-	–7,684	-	76	–7,608
Gross profit	867	374	16	150	-	1,407	183	-	1,590	-	–62	1,528
Selling and administrative
expenses 1)	–235	–155	–30	–59	-	–479	–135	–35	–649	-	-	–649
Gains on the sale of properties	2	-	26	-	-	28	-	-	28	-	-	28
Operating profit	634	219	12	91	-	956	48	–35	969	-	–62	907
Financial income and expenses										–67	-	–67
Net profit/loss before taxes									969	–67	–62	840
Taxes										–262	16	–246
Net profit for the year									969	–329	–46	594
Operating margin (%)	16.6	8.0		6.1			3.1					9.9
1) Including depreciation of
machinery and equipment	0	–1	-	0	-	–1	–3	–3	–7	-	-	–7
Group 2009
Revenues – external	3,330	2,296	309	1,490	-	7,425	1,353	-	8,778	-	842	9,620
Revenues – internal	-	-	-	518	–518	-	-	-	-	-	-	-
Total revenues	3,330	2,296	309	2,008	–518	7,425	1,353	-	8,778	-	842	9,620
Production and operating costs 1)	–2,612	–1,998	–252	–1,826	518	–6,170	–1,331	-	–7,501	-	–860	–8,361
Gross profit	718	298	57	182	-	1,255	22	-	1,277	-	–18	1,259
Selling and administrative
expenses 1)	–224	–132	–22	–52	-	–430	–139	–46	–615	-	-	–615
Gains on the sale of properties	2	0	75	-	-	77	12	-	89	-	-	89
Impairment of properties	-	-	-	-	-	-	–87	-	–87	-	-	–87
Operating profit	496	166	110	130	-	902	–192	–46	664	-	–18	646
Financial income and expenses										–117	-	–117
Net profit/loss before taxes									664	–117	–18	529
Taxes										–168	4	–164
Net profit for the year									664	–285	–14	365
Operating margin (%)	14.9	7.2		6.5			–14.2					6.7
1) Including depreciation of
machinery and equipment	–1	–1	0	0	-	–2	–7	–4	–13	-	-	–13

2)  Unallocated items within the Group pertain to financial income and expenses, as well as tax.

3)  Effect of restatement on income and profit and loss according to IFRIC 15 in relation to segment reporting.

For more information about IFRIC 15, please see the accounting principles on pages 54–57 and the tables that show the effects of restatement on pages 80–81.

CONSOLIDATED BALANCE SHEET BY BUSINESS SEGMENT

	JM Residen tial	JM Residen tial	JM Property develop	JM Produc	Sub total	JM Interna	Sub total	Unallo cated items Group	Restate ment JM Interna	Total
Group Dec. 31, 2010	Stockholm	Sweden	ment	tion	Sweden	tional	Group	4) 5)	tional 3)	Group
ASSETS
Non-current assets	-	-	-	-	-	58	58	160	1	219
Project properties	-	2	625	-	627	34	661	-	-	661
Development properties	2,562	1,497	60	-	4,119	1,255	5,374	-	-	5,374
Participations in tenant-owners associations, etc.	39	68	-	-	107	8	115	-	-	115
Current receivables	210	412	41	187	850	372	1,222	315	–100	1,437
Cash and cash equivalents	-	-	-	-	-	-	-	2,087	-	2,087
Total current assets	2,811	1,979	726	187	5,703	1,669	7,372	2,402	–100	9,674
TOTAL ASSETS	2,811	1,979	726	187	5,703	1,727	7,430	2,562	–99	9,893
EQUITY AND LIABILITIES
Equity	-	-	-	-	-	-	-	3,995	–72	3,923
Non-current liabilities	-	-	-	-	-	-	-	2,335	–26	2,309
Current liabilities	780	482	5	280	1,547	105	1,652	2,010	–1	3,661
TOTAL EQUITY AND LIABILITIES	780	482	5	280	1,547	105	1,652	8,340	–99	9,893
Total operating capital by business
segment	2,031	1,497	721	–93	-	1,622	-	-	-	-
Investment in machinery and equipment	-	-	-	-	-	-	-	3	-	3
Group Dec. 31, 2009
ASSETS
Non-current assets	-	-	-	-	-	62	62	196	1	259
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	–44	1,659
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	–44	9,628
TOTAL ASSETS	2,530	2,009	702	187	5,428	2,031	7,459	2,471	–43	9,887
EQUITY AND LIABILITIES
Equity	-	-	-	-	-	-	-	3,668	–31	3,637
Non-current liabilities	-	-	-	-	-	-	-	2,132	–11	2,121
Current liabilities	737	427	34	335	1,533	80	1,613	2,517	–1	4,129
TOTAL EQUITY AND LIABILITIES	737	427	34	335	1,533	80	1,613	8,317	–43	9,887
Total operating capital by business
segment	1,793	1,582	668	–148	-	1,951	-	-	-	-
Investment in machinery and equipment	-	-	-	-	-	-	-	9	-	9

JM	JM	JM
Residen	Residen	Property	JM	JM
tial	tial	develop	Produc	Interna
Stockholm	Sweden	ment	tion	tional
–34	312	–118	36	236
544	70	620	173	–174

Income by country including adjustment
according to IFRIC 15	Sweden	Norway	Denmark	Finland	Belgium	Total
2010	7,704	1,295	24	7	106	9,136
2009	7,425	1,084	790	90	231	9,620

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

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

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

60 notes–group

NOTe 3 EMPLOYEES AND PERSONNEL COSTS

Average number of employees, by country	2010		Of which men, %	2009		Of which men, %
Sweden	1,797		85	1,848		84
Norway	218		83	208		82
Denmark	11		64	17		59
Finland	6		50	7		57
Belgium	11		45	15		60
Total	2,043		84	2,095		83
		2010			2009
Wages, salaries, other remuneration	Wages,	Social		Wages,	Social
and social security expenses	salaries and	security		salaries and	security
	remuneration	expenses	Total	remuneration	expenses	Total
Group	924	468	1,392	969	458	1,427
(pension costs)		(181)1)			(171)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 0.5m (0.4).

		2010		2009
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 (variable compensation)	13 (3)	771 (60)	784 (63)	9 (1)	798 (61)	807 (62)
Norway (variable compensation)	1 (0)	118 (6)	119 (6)	3 (0)	128 (4)	131 (4)
Denmark (variable compensation)	2 (0)	9 (0)	11 (0)	1 (0)	15 (0)	16 (0)
Finland (variable compensation)	1 (0)	4 (1)	5 (1)	3 (1)	5 (1)	8 (2)
Belgium	1	4	5	1	6	7
(variable compensation)	(0)	(0)	(0)	(0)	(1)	(1)
Total Group	18	906	924	17	952	969
(variable compensation)	(3)	(67)	(70)	(2)	(67)	(69)

Employees and personnel costs

Compensation to the Board of Directors

JM's Board, excluding the President, consists of a total of ten people, seven men and three women. Six of these ten people were elected by the Annual General Meeting, three men and three 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 (700,000) in board fees. The other non-executive Board members (five people) were paid SEK 1,763,000 (1,838,000).

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. Compensation to the President and other members of Executive Management is based on the Annual General Meeting resolution on guidelines for salaries and other remuneration to senior executives. The combined remuneration must be competitive in the labor market in which the executive is active.

The short-term variable compensation for 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 2011 may amount to a maximum of SEK 2,280,000. Total short-term variable compensation for the 2010 financial year was SEK 1,926,000 (1,536,000) to be paid during the spring of 2011. 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 2011 may amount to a maximum of SEK 5.3m. The outcome of the short-term variable compensation for other members of Executive Management for the 2010 financial year was SEK 4.4m (3.5), to be paid during the spring of 2011.

In addition, long-term variable salary programs have been offered since 2009 to Executive Management (including the President). The first long-term variable salary program, which was launched in 2009, amounts to 30 percent of fixed salary, and is based on the Group financial results 2011. Payment will be made if appropriate 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. The second long-term variable salary program, which was launched in 2010, amounts to a maximum of 42 percent of fixed salary, and is based on the Group financial results 2012. Payment will be made if appropriate in the spring of 2013, with a maximum of SEK 1,764,000 for the President and SEK 4.5m 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 or 2010.

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 47,500 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 about SEK 7m including social security expenses.

The 2007 share match program covered 20,568 shares, equivalent to dilution of about 0.03 percent of shares and votes in the Company. All shares for the program were redeemed in 2010. The total cost of the 2007 share match program, which was charged against earnings during the three-year vesting period, was about SEK 6m including social security expenses.

For more information please see the summary on page 61.

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.

Summary of basic and variable compensation and pensions to the Board and Executive Management in 2010 and 2009.

		2010
	Basic sal ary/	Variable
	Board	compen	Other	Pension
SE K 000s	fee	sation 1)	benefits	costs	Total
Chairman of the Board
Lars Lundquist	700	-	-	-	700
Other Directors
Elisabet Annell	355	-	-	-	355
Torbjörn Torell	315	-	-	-	315
Åsa Söderström Jerring	398	-	-	-	398
Anders Narvinger	340	-	-	-	340
Berthold Lindqvist	185	-	-	-	185
Kia Orback Pettersson	170	-	-	-	170
President	4,305	1,536	164	1,422	7,427
Others in Executive
­Management 2)	13,127	2,889	501	6,021	22,538
Total	19,895	4,425	665	7,443	32,428

	2009
	Basic sal ary/	Variable
	Board	compen	Other	Pension
SE K 000s	fee	sation 1)	benefits	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 2010. All payments in 2010 are attributable to the 2009 financial year.

2) JM's Executive Management, excluding the President, comprised a total of eight people in 2010, six men and two women.

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 people in 2009, six men and two women.

Share match program

							Percentage
		Number of		Right-1 redeemed	Right-1	Number of right 1	of total number of		Re demp
		right 1	Number	shares	shares due	shares	out	Fair value	tion		Vesting
Issued		shares allo	on	in	in	per Dec. 31	standing	per share,	price	Due	period,
year	Holder	cated	January 1	2010	2010	2010	shares, %	SE K	SEK	date	year
2007	President	2,701	2,701	–2,701	-	-	0	258.24	10	2014-12-31	3
2007	Others in Executive
	­Management	8,038	8,038	–8,038	-	-	0	258.24	10	2014-12-31	3
2007	Other	14,739	13,641	–13,641	-	-	0	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	3,893		-	3,893	0.005	107.66	10	2015-12-31	3
2008	Other	12,495	10,013	–1,036	-	8,977	0.010	107.66	10	2015-12-31	3
		43,261	38,836	–25,416	-	13,420	0.016

Performance share program

							Percentage
				Redeemed		Number of	of total		Re
		Number of		right 2	Right 2	right 2	number of		demp
		allocated	Number	shares	shares due	shares	out	Fair value	tion		Vesting
Issued		right 2	on	in	in	per Dec. 31	standing	per share,	price	Due	period,
year	Holder	shares	January 1	2010	2010	2010	shares, %	SE K	SEK	date	year
2008	President	4,274	4,274	-	-	4,274	0.005	107.66	10	2011-12-31	3
	Others in Executive
2008	­Management	14,599	10,347	–440	-	9,907	0.012	107.66	10	2011-12-31	3
2008	Other	24,577	21,329	–1,430	-	19,899	0.024	107.66	10	2011-12-31	3
		43,450	35,950	–1,870	-	34,080	0.041

Convertible debentures for personnel

The 2010 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 227,045 convertible bonds for a nominal amount of SEK 32m as well as 5,320 warrants were issued. The loan matures on June 16, 2014 and entitles the holders to convert to one JM share for SEK 139 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.

Convertible bonds and options

Year	Number of con vertible bonds	Number of warrants	Number of redeemed convert ible bonds/warrants	Number of convertible bonds/ warrants due	Total	Strike price	Conversion Period
2007	493,918	-	-	-	493,918	262.30	2009-06-01–2011-06-01
2008	423,650	69,995	-	-	493,645	134.00	2010-06-01–2012-05-18
2009	371,917	20,301	-	-	392,218	74.00	2011-06-01–2013-05-24
2010	227,045	5,320	-	-	232,365	139.00	2012-06-01–2014-05-22

Note 3 cont.

Absence due to illness at JM Sweden

Total absence due to illness amounts to 3.6 percent (3.6) of regular working hours. Of total absence due to illness, 56 percent (51) comprises absence due to illness for more than 60 days.

Absence due to illness, by age, %	2010	2009
–29 years	3.4	4.6
30–49 years	3.1	3.1
50 years and older	4.6	3.9
Absence due to illness, by gender, %	2010	2009
Men	3.9	3.9
Women	2.5	2.3

Note 4 DEPRECIATION ACCORDING TO PLAN

	2010	2009
Machinery and equipment	–7	–13
Total	–7	–13

The following depreciation rates are applied:

Construction machinery 10%

Computers and other equipment 20–33%

NOT e 5	FEES AND REMUNERATION TO AUDITORS
		2010	2009
Ernst & Young
Auditing services		4.7	4.5
Tax services		0.1	-
Other services		0.3	0.7
Total		5.1	5.2

2010	2009
17	532
63	133
80	665
-	–445
–52	–131
–52	–576
17	87
11	2
28	89
2010

	Sales value	Results
Development properties	63	11
Project properties, reversal of earlier provi
sions in conjunction with property sales	17	17
Total	80	28

NOTe 7 IMPAIRMENT OF PROPERTIES

	2010	2009
Development properties	-	–87
Total	-	–87

Impairment losses in 2009 pertain to development properties located in Copenhagen.

NOTe 8 FINANCIAL INCOME AND EXPENSES

		Financial income
	2010	2009
Dividend	2	2
Interest income	12	10
Realized exchange rate gains relating to debt
receivable, international company	30	2
Change in value revaluation of debt receivable and
currency hedging	2	27
Gain from sale of shares in associated companies	5	-
Total	51	41
	Financial expenses
	2010	2009
Interest expense attributable to loans, etc.	–58	–105
Interest portion in this years pension costs	–27	–26
Realized exchange rate losses relating to debt
receivable, international company	–15	–20

currency hedging –18 –7 Total –118 –158

Change in value revaluation of debt receivable and

NOT e 9 TAXES
	2010	20091)
Net profit/loss before taxes
Sweden	885	773
International	–45	–244
Total	840	529
Current tax
Sweden	–195	–168
International	–25	7
Total	–220	–161
Deferred tax
Sweden	–36	–22
International	10	19
Total	–26	–3
Total tax
Sweden	–231	–190
International	–15	26
Total	–246	–164

Difference between reported tax and nominal tax rate 26.3%

	2010	20091)
Profit before tax 26.3%	–221	–140
Adjustment of tax from previous years	-	–17
Difference foreign tax	-	1
Non-taxable income	6	13
Non-deductible expense	–2	–5
Tax untaxed reserve (tax allocation reserve)	–4	–2
Revaluation deferred tax	–25	–14
Total	–246	–164

1) Comparative figures were restated due to the changed accounting principles regarding revenue recognition in JM International. For more information about IFRIC 15, please see the accounting principles on pages 54–57 and the tables that show the effects of restatement on pages 80–81.

NOT e 10	EARNINGS PER SHARE AND DIVIDEND
			Basic		Diluted
		2010	20091)	2010	20091)
Earnings per share (SE K)		7.10	4.40	7.10	4.40

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.

Basic earnings per share

Calculation of basic earnings per share for 2010 is based on the profit for the year attributable to shareholders of the Parent Company of SEK 594m (365) and on a weighted average number of outstanding ordinary shares during 2010 amounting to 83,229,492 (83,216,883). Profit for the year is attributable in its entirety to shareholders of the Parent Company.

Number of shares	2010	2009
Total number of outstanding shares, January 1	83,216,883	83,216,883
Sale of own shares	12,609	-
Weighted average number of shares during
the year, basic	83,229,492	83,216,883

Diluted earnings per share

Calculation of diluted earnings per share for 2010 is based on the profit for the year attributable to shareholders of the Parent Company of SEK 601m (374) and on a weighted average number of outstanding ordinary shares during 2010 amounting to 84,671,817 (84,376,081). Profit for the year is attributable in its entirety to shareholders of the Parent Company.

Net profit for the year	2010	20091)
Profit for the year attributable to shareholders of the
Parent Company	594	365
Adjustment of interest on convertible debentures
(after tax)	7	9
Profit for the year attributable to shareholders
of the Parent Company, diluted	601	374
Number of shares	2010	2009
Weighted average number of shares during the year,
basic	83,229,492	83,216,883
Effect of issued long-term salary program	1,442,325	1,159,198
Weighted average of the number of shares dur
ing the year, diluted	84,671,817	84,376,081

Outstanding number of shares and instruments with potential dilutive effects

At the end of 2010 JM had 83,237,058 outstanding shares (83,216,883). During the second quarter of 2010, the 2007 share match program for senior executives within the JM Group was completed. In all, 20,175 shares of JM's holdings were sold to senior executives for the agreed strike price of SEK 10 per share. JM holds a total of 164,825 repurchased shares (185,000) as a hedge for its long-term salary program.

Instruments that may have a potentially dilutive effect include JM 's share match program (2008), JM's 2008 performance share program, JM's four convertible programs (2007, 2008, 2009 and 2010) and JM's three warrant programs (2008, 2009 and 2010).

When calculating earnings per share, JM 's convertible program and warrant program entail a dilution of the number of shares. However, the effect is limited. The conversion price for the 2007 convertible bond program is 262.30. The strike price for the 2008 convertible bond and warrant program is SEK 134, for the 2009 program SEK 74 and for the 2010 program SEK 139.

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.

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

Cash dividend

(proposed by the Board for 2010)	2010	2009
– per share (SEK)	4.50	2.50
– total (SEK m)	375	208

1) Comparative figures were restated due to the changed accounting principles regarding revenue recognition in JM International. For more information about IFRIC 15, please see the accounting principles on pages 54–57 and the tables that show the effects of restatement on pages 80–81.

	GOODWILL
NOT e 11

	2010	2009
Opening cost
Opening balance, January 1	62	56
Translation differences	–4	6
Closing balance, December 31	58	62

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 a need for impairment. Defined goodwill for the acquisitions of 1998 and 1999, respectively, totaled about NOK 100m.

AS Projektfinans merged with Byggholt AS 2003 and operations are considered fully integrated in Byggholt AS and the Byggholt Group is therefore the lowest cash-generating unit. The carrying amount for the Byggholt Group was tested as of December 31, 2010 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 2010, 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 amount would decrease by 25 percent.

A sensitivity analysis of the discount rate shows that the discount rate would have to exceed about 19 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 impairment of goodwill for the Norwegian business.

NOTe 12 MACHINERY AND EQUIPMENT

	2010	2009
Opening cost
Opening balance, January 1	116	118
New purchases	3	9
Reclassification	–11	-
Translation differences	–3	2
Sales	–1	–13
Closing balance, December 31	104	116
Accumulated depreciation according to plan
Opening balance, January 1	–98	–97
Depreciation for the year	–7	–13
Reclassification	11	-
Translation differences	2	–1
Sales	0	13
Closing balance, December 31	–92	–98
Closing residual value according to plan	12	18

NOTe 13 PARTICIPATIONS IN ASSOCIATES 2010 2009 Opening cost Opening balance, January 1 12 6 New purchases 0 6 Reclassifications –2 - Sales –1 0

Closing balance, December 31 9 12

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	2010	2009
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	16	11
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	135,886	105,886
Kvibergstaden Exploatering HB 2)	969731-1695	Gothenburg	1	50	13,000	2,000
Mälarstrandens Utvecklings AB 2)	556695-5414	Västerås	44	44	2,200	2,200
SMÅA AB	556497-1322	Stockholm	35,000	33	7,859	8,950
Carrying amount, December 31					164,425	124,511

1) Unlimited liability 2) Joint ventures

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

	Registration		Number of shares	% of		Carrying amount
Company	number	Domicile	and participations	capital	2010	2009
Fastighets AB Kranlyftet
(fd AB Grundstenen 132793)	556829-3251	Lidingö	250	50	135,226	-
Grefsen Utvikling AS, Norway	982913209	Bærum	500	50	21,779	–5,835
Hans Nielsen Haugesgate 50 AS, Norway	987719427	Bærum	120,000	50	24,032	-
Investbygg AS, Norway	987326476	Bergen	500	50	192	–441
Kjørbokollen Utbygging AS, Norway	981112326	Bærum	10,000	50	1,824	2,138
Landmannstorget, Norway	987598387	Asker	100	50	20	38
Larvik Saneringsselskap AS, Norway	918044051	Larvik	100	50	1,912	2,052
Merbraine, Belgium	450160865	Brussels	313	25	144	155
Slussbron Ekonomisk förening	769613-7160	Stockholm	3	100	0	-
Son Utvikling AS, Norway	990341419	Oslo	550	50	10,630	11,798
Tennisveien AS, Norway	450160865	Oslo	-	-	-	251
Carrying amount, December 31					195,759	10,156
Reclassification in the Group, primarily due to the proportional method					–351,534	–122,931
Carrying amount in the Group, December 31					8,650	11,736

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.

	2010	2009
Revenues	26	110
Expenses	–25	–92
Result	1	18
Assets	453	526
Liabilities	–247	–248
Net assets	206	278

NOTe 15 FINANCIAL ASSETS

	2010	2009
Opening cost
Opening balance, January 1	71	21
Additional receivables	0	45
Settled receivables	–3	–6
Reclassification	-	10
Translation differences	–4	1
Closing balance, December 31	64	71

Financial assets mainly relate to promissory notes.

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	2010	2009
AB Borätt	556257-9275	Stockholm	500	1,978	1,978
AB Christeliten	556720-1180	Stockholm	1,000	100	-
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	Gothenburg	1	1,120	1,120
Fastighetsbolaget Kung Oscars Bro AB	556692-4493	Lund	100	10,475	10,475
Fastighetsbolaget Raffinadgatan AB	556682-8835	Lund	1,000	10,631	10,631
Förvaltningsbolaget Gnarpen AB 1)	556717-3793	Stockholm	-	-	100
JM Byggholt AS, Norway	829350122	Oslo	20,000	127,687	127,687
JM Byrån Holding AB	556752-9630	Stockholm	1,000	100	100
JM Construction SA, Belgium	413662141	Brussels	10,000	111,906	111,906
JM Danmark AS, Denmark	21410233	Copenhagen	100,000	167,752	227,701
JM Entreprenad AB	556060-8837	Stockholm	200,000	107,750	107,750
JM Hjulkuggen 1och 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, Finland	1974161-8	Helsinki	1,000	106,669	113,201
JM Värmdöstrand AB	556001-6213	Värmdö	4,400	158,000	-
JM Värmdöstrand Holding AB	556275-4696	Stockholm	3,300,120	292,442	292,442
JM Älta Centrum AB	556638-5380	Stockholm	1,000	564	564
JM Älta Holding AB	556638-5372	Stockholm	1,000	40,100	40,100
KB Silverfjädern	969676-7525	Stockholm	-	0	0
Kvarnexet 1 AB 1)	556782-4163	Stockholm	-	-	41,148
Kvarnexet 5 AB 1)	556795-0547	Stockholm	-	-	37,609
Lekandria Fastighets AB	556701-9046	Stockholm	1,000	100	100
Makaronen 1	556829-5959	Stockholm	500	77,108	-
Milud AB 1)	556395-8643	Västerås	1,000	-	100
Bo Entreprenad AB	556807-5328	Stockholm	1,000	100	-
Projektmäklarna AB 1)	556680-1873	Stockholm	-	-	100
SBC Bo AB	556754-2138	Stockholm	700	3,550	-
Seniorgården AB	556359-9082	Stockholm	1,000	100	100
Södra 1 och 2 i Lund AB	556720-6148	Lund	1,000	113	113
Tellaplan Fastighets AB	556733-6010	Stockholm	1,000	100	-
TG Betongarbeten Produktion AB 1)	556476-7720	Trollhättan	-	-	3,860
Årstapaviljongen AB	556069-3425	Stockholm	1,000	142	-
Carrying amount, December 31				1,234,541	1,144,839

¹ ) Group companies merged into JMAB.

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

		Registration		Carrying amount
Company	number	Domicile	Number of shares and participations	2010	2009
AB Christeliten	556720-1180	Stockholm	-	-	100
AB Stockholms Badmintonhall	556037-3655	Stockholm	2,520	391	391
Brf Mården	716300-0499	Stockholm	3,800,000	0	0
Byggholt AS, Norway	991460012	Bærum	100	118	133
Dinant-Meuse, Belgium	879639352	Brussels	-	-	632
Esplanade 64, Belgium	888411419	Brussels	-	-	1,553
Fabege V 27 AB	556806-1419	Solna	50,000	1,183	-
Fabege V 28 AB	556806-1427	Solna	50,000	90,223	-
Fastighet 1 DPL 3 AB	556716-5047	Stockholm	-	-	6,030
Fastighet 2 DPL 3 AB	556716-5062	Stockholm	-	-	6,901
Fastighet 3 DPL 3 AB	556716-5070	Stockholm	-	-	7,468
Fastighet 4 DPL 3 AB	556716-5245	Stockholm	-	-	7,185
Fastighet 5 DPL 3 AB	556716-6581	Stockholm	-	-	2,284
Fastighet 6 DPL 3 AB	556716-6615	Stockholm	-	-	2,128
Fastighet 7 DPL 3 AB	556716-6623	Stockholm	-	-	15,553
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	300
JM Byggholt Proff, Norway	934787889	Bærum	50	672	613
JM Norge AS, Norway (formerly Søilandsgaten Sjøfront AS)	987558733	Stavanger	1	482	2,378
JM Vaxholm AB	556390-9174	Stockholm	13,300	1,333	1,333

Note 16 cont.

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	2010	2009
JM Värmdöstrand AB	556001-6213	Värmdö	-	-	158,000
Lervig Maritim Utbyggingsselskap AS, Norway	984295707	Stavanger	10,000	627	975
Lervig Maritim Næring I AS, Norway	996294447	Stavanger	100	150	-
Lervig Maritim Næring II AS, Norway	996122999	Stavanger	100	150	-
Lervig Maritim Næring III AS, Norway	996040917	Stavanger	100	150	-
Lidingöstrand Fastighets AB	556740-2648	Stockholm	1,000	100	100
Mariastaden AB	556228-8596	Stockholm	100	2,000	2,000
Månstrålen Holding AB	556072-9492	Stockholm	5,000	708,759	739,759
Nærsnesutbyggingen AS, Norway	963574061	Bærum	90,000	19,179	20,695
Naturtomter AS, Norway	930586595	Tønsberg	15	–1,165	–1,074
Nor-Invest AS, Norway	934223144	Tønsberg	514,396	23,349	25,193
Rodelunden Utvikling AS, Norway
(formerly Sophies Minde Utvikling AS)	990291977	Oslo	300	7,312	7,896
Sjövikshöjdens Gruppbostad AB	556829-1016	Stockholm	1,000	100	-
Slussbron Ett AB	556749-2870	Stockholm	1,000	100	-
Slussbron Två AB	556749-2888	Stockholm	1,000	100	-
Slussbron Tre AB	556749-2896	Stockholm	1,000	100	-
Stavanger Naeringsselskap AS, Norway	968487272	Stavanger	83,451,000	20,294	27,409
Tellaplan Fastighets AB	556733-6010	Stockholm	-	-	100
Trulsrudmarka AS, Norway	978695493	Bærum	1,000	1,022	1,848
Årstapaviljongen AB	556069-3425	Stockholm	-	-	142
Äldreboendet Solbacka AB	556768-3924	Stockholm	1,000	100	100
Äldreboendet Fjäderholmsvyn AB	556826-3429	Stockholm	1,000	100	-

PRO JECT PROPERTIES AND NOT e 17 DEVELOPMENT PROPERTIES
		Project properties 1)		Development properties
	2010	2009	2010	2009
Opening cost
Opening balance, January 1	596	614	5,491	6,046
New purchases	74	443	1,069	280
Corporate acquisitions	-	10	586	148
Reclassifications	–6	–33	–1	20
Translation differences	–3	7	–167	38
Transferred to production	-	-	–1,150	–910
Sales	-	–445	–52	–131
Closing balance, December 31	661	596	5,776	5,491
Accumulated impairment losses
Opening balance, January 1	-	-	–501	–426
Translation difference	-	-	29	12
Transferred to production	-	-	70	-
Impairment losses for the year	-	-	-	–87
Closing balance, December 31	-	-	–402	–501
Closing residual value according
to plan	661	596	5,374	4,990
Tax assessment values	339	296	2,800	2,836

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

Reported residual value for the part of development properties recognized at net realizable value amounts to SEK 1,465m (1,601).

New purchases 325 1,519 Reclassifications –5 - Translation difference –16 –1

Sales	–542	–1,336
Closing balance, December 31	115	353

NOTe 19 OTHER CURRENT RECEIVABLES

	2010	2009
Receivables from property sales	35	3
Receivables from participations sold in
tenant-owners associations	75	95
Deposit investment development properties	107	108
Other	196	141
Total	413	347

NOTe 20 RECOGNIZED REVENUE LESS PROGRESS BILLINGS

	2010	20091)
Recognized revenue in work in progress	2,955	4,041
Accumulated billing on account for work in progress	–2,506	–3,389
Total	449	652

1) Comparative figures were restated due to the changed accounting principles regarding revenue recognition in JM International. For more information about IFRIC 15, please see the accounting principles on pages 54–57 and the tables that show the effects of restatement on pages 80–81.

NOTe 21 WORK IN PROGRESS

	2010	20091)
Accumulated costs incurred	1,264	1,514
Accumulated billing on account for work in progress	–1,147	–1,242
Total	117	272

Work in progress only relates to projects within JM International.

1) Comparative figures were restated due to the changed accounting principles regarding revenue recognition in JM International. For more information about IFRIC 15, please see the accounting principles on pages 54–57 and the tables that show the effects of restatement on pages 80–81.

NOTe 22 CASH AND CASH EQUIVALENTS

	2010	2009
Cash and bank balances	1,387	830
Short-term investments	700	1,200
Total	2,087	2,030

Short-term investments have a maturity of between one day and up to three months.

NOTe 23 FINANCIAL LIABILITIES

Non-current interest-bearing liabilities				2010	2009
Liabilities to credit institutions maturity date 1–5
years from closing day				92	83
Long-term promissory notes, development properties
1–5 years				55	15
Convertible loan 1–5 years				111	220
	Liabilities to credit institutions, maturity > 5 years
from closing day				-	8
Total				258	326
Current interest-bearing liabilities				2010	2009
Liabilities to credit institutions, interest-bearing
–1 year				372	232
Short-term promissory notes, development
properties				-	719
Convertible loan –1 year				142	-
Total				514	951
Interest-bearing
net liabilities/receivables		2010 Change		2009 Change	2008
Current interest-bearing liabilities	514	–437	951	–186	1,137
Non-current interest-bearing
liabilities	258	–68	326	12	314
Transferred to pensions	585	20	565	52	513
Minus: cash and cash equivalents	–2,087	–57	–2,030	–919	–1,111
Minus: interest-bearing
receivables	-	1	–1	10	–11
Interest-bearing net
liabilities (+)/-receivables (–)
at year-end	–730	–541	–189	–1,031	842
Other financial liabilities				2010	2009
Other non-current liabilities 1–5 years from
closing day				218	113
Accounts payable				466	365
Derivative instruments, short-term				1	3
Short-term promissory notes, development
properties				236	116
Other current liabilities				236	352
Total				1,157	949

Financial liabilities are divided into non-current and current liabilities, where current liabilities are due within 1 year. Other non-current liabilities relate to promissory notes for property acquisitions that become payable when various terms and conditions are met. See note 24 Financial risk management and financial derivative instruments.

NOTe 24 FINANCIAL RISK 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 biggest risk factors involves choosing the interest rate period for the Group's loan portfolio. JM chooses its fixed-interest period 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 fixed-interest period, 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 fixed-interest period excluding pension liability on December 31, 2010, was 0.2 years (0.3).

Fair value on interest-bearing loans was SEK 772m (1,277). 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, 2010.

Interest risk exposure, including derivatives

		2010	2009
Year for interest conversion	Loan amount (SE Km)	Average interest (%)	Loan amount (SE Km)	Average interest (%)
2010	-	-	1,277	4.0
2011	772	2.8	-	-
Pension liability 1)	585	4.5	565	4.0
Total	1,357	3.6	1,842	4.0

1) Pension interest adjusted annually.

The average interest rate on interest-bearing liabilities as of December 31, 2010 excluding pension liabilities was 3.6 percent (4.0). A 1 percent change in the market interest rate corresponds with an effect on earnings of about SEK 5m for the part of the loan portfolio traded during 2011. 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 22 for breakdown between cash and short-term investments.

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		Over
commitments		draft
Maturity	Total	facility	2011	2012	2013–2015
Loan commitments (SEKm)	2,800	400	650	1,500	250

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,

Note 24 cont.

see note 1 Accounting and valuation principles. Accounts receivable for project development amounts to SEK 325m (225).

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 119m (160).

The provision for doubtful receivables amounts to SEK 5.3m (5.6). During the year the Group used SEK 0.6m (1.0) of earlier provisions. Accounts receivable older than 60 days amounts to SEK 82m (57). Provision and utilization of the provision for doubtful receivables were recognized in the income statement.

Aged accounts receivable

Dec. 31, 2010	Nomi	Not	< 30	31–60	61–90	> 90
SE Km	nal	due	days	days	days	days
Residential development	325	183	59	11	3	70
Contracting	120	97	14	0	0	9
Other	–1	–1	-	-	-	-
Total	444	279	73	11	3	79
Number of invoices	1,222	684	154	50	56	278
Dec. 31, 2009	Nomi	Not	< 30	31–60	61–90	> 90
SE Km	nal	due	days	days	days	days
Residential development	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

Credit risk analysis customers

Dec. 31, 2010 Interval	Number of customers	In % of number	In % of portfolio
Exposure interval < SEK 1m	749	90	19
Exposure interval SEK 1–5m	64	8	40
Exposure interval > SEK 5m	20	2	41
Total	833	100	100
Dec. 31, 2009	Number of	In % of	In % of
Interval	customers	number	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

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, 2010 and 2009. 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.

	Cat egory	Dec. 31, 2010		Dec. 31, 2009
	accord
Fair value	ing to	Carrying	Fair	Carrying	Fair
financial instruments	IAS 391)	amount	value	amount	value
Assets
Interest-bearing financial
assets	L&R	1	1	1	1
Other financial assets	L&R	63	59	70	65
Other long-term receivables L&R		63	59	70	65
Other long-term securities	AFS	0	0	0	0
Accounts receivable	L&R	444	444	385	385
Other current receivables	L&R / n/a	413	413	347	347
Derivative instruments 2)	FAvPL	0	0	0	0
Receivables from property
sales	L&R	35	35	3	3
Other	n/a	378	378	344	344
Cash, cash equivalents, and
short-term investments	L&R	2,087	2,087	2,030	2,030
Cash and bank balances	L&R	1,387	1,387	830	830
Short-term investments	L&R	700	700	1,200	1,200
Liabilities
Non-current interest
bearing liabilities	FLAC	258	258	326	326
Convertible loan	FLAC	111	111	220	220
Other non-current
interest-bearing liabilities	FLAC	147	147	106	106
Other non-current liabilities FLAC		218	218	113	113
Accounts payable	FLAC	466	466	365	365
Current interest-bearing
liabilities	FLAC	514	514	951	951
Other current liabilities	FLAC	473	473	471	471
Derivative instruments 2)	FLrlS	1	1	3	3
Other current liabilities	FLAC	472	472	468	468

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

AFS Available-for-sale financial assets

L&R Loans 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 through profit or loss

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.

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.

The JM Group has no outstanding interest rate derivatives as of December 31, 2010. Currency derivatives for Group loan to international company remeasured at fair value to SEK –1m (–3).

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 77.

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

	PROVISIONS FOR PENSIONS
NOT e 25	AND SIMILAR COMMITMENTS

Defined-benefit plans

JM has a defined-benefit plan for pensions, the ITP 2 plan in Sweden, which is financed in-house. In 2010, due to a change in the rules in Norway, JM chose to reclassify what was previously called a defined-benefit plan to a defined-contribution plan. In 2009 JM chose to reclassify the alternative ITP plan offered by the company to a definedcontribution 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. 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	2010	2009
Pension obligations, funded plans	-	20
Managed assets' fair value	-	–11
Net sum, funded plans	-	9
Pension obligations, unfunded plans	691	688
Unrecognized actuarial gains (+), losses (–), pension
commitments	–106	–132
Unrecognized actuarial gains (+), losses (–), plan assets	-	0
Net liability according to the balance sheet	585	565

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			2010		2009
Opening balance, January 1			708		1,000
Benefits earned during the year				19	23
Interest expense				27	26
Benefits paid			–23		–20
Reclassification			–21		–328
Unrecognized actuarial gains (–), losses (+)			–19		5
Translation differences				-	2
Closing balance, December 31			691		708
Plan assets, fair value			2010		2009
Opening balance, January 1				11	261
Reclassification			–11		–251
Unrecognized actuarial gains (+), losses (-)				-	0
Translation differences				-	1
Closing balance, December 31				0	11
Reconciliation pension provisions			2010		2009
Opening balance, January 1			565		513
Pension costs, defined-benefit plans				51	54
Benefits paid			–23		–20
Reclassification				–8	17
Translation differences				-	1
Closing balance, December 31			585		565
Actuarial gains (+), losses (–)	2010	2009	2008	2007	2006
Total pension commitments	691	708	1,000	843	809
Plan assets, fair value	-	11	261	215	152
Experience adjustments, percentage of
this year's unrecognized actuarial gains
(+) and loss (–)
Pension obligations (SEKm)	–37	–10	–10	3	7
Percent of total value of
pension commitments	–5.3	–1.4	–1.0	0.4	0.9
Plan assets (SEKm)	-	–0.4	–3.0	17.0	–6.0
Percent of fair value of managed assets	-	–3.3	–1.1	7.9	–4.0

Pension expenses	2010	2009
Benefits earned during the year	19	23
Interest on obligations	27	26
Amortization actuarial loss	5	5
Pension costs, defined-benefit plans	51	54
Pension costs, defined-contribution plans	124	112
Social security expenses, defined-benefit and
defined-contribution plans	33	31
Total	208	197

Of the above pension costs, SEK 27m (26) is recognized as a financial cost, corresponding with the interest on the obligation.

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, 2010, is greater than 10 percent of the actual pension obligation, JM must expense a small part of the actuarial loss in 2011. For JM this means an increased pension cost in 2011 of SEK 3m, including social security expenses, relating to this part.

JM 's expects cash flow for the pension provision in 2011 to be SEK –26m.

Actuarial assumptions

The most important actuarial assumptions as per closing day can be seen in the following table. Sweden

%	2010	2009
Discount rate	4.50	4.00
Expected salary increases	3.50	3.50
Inflation	2.00	2.00
Income base amount	3.00	3.00
Attrition rate	3.00	3.00

The discount rate is determined for each geographic market taking the market return on corporate bonds on the closing day into account. In Sweden, where there is no functioning market for such bonds, the market return on mortgage 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 in Sweden uses mortality assumptions to calculate its pension liability, which in practical terms means that JM assumes that a man in Sweden who is currently 65 will live for 21 years after retirement and a woman for 23 years.

NOTe 26 OTHER PROVISIONS

		Product warranty provisions
	2010	2009
Opening balance, January 1	318	278
Utilized/Reversals	–80	–95
Provisions	80	135
Closing balance, December 311)	318	318
1) Of which short-term part of provisions
for guarantees	111	133

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 approximately 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 27 DEFERRED TAX ASSETS AND LIABILITIES

	2010	20094)
Deferred tax liability on untaxed reserves 1)	218	157
Other deferred tax liability*	906	885
Sub-total	1,124	1,042
Less deferred tax assets 2)	–83	–110
Net provisions for taxes	1,041	932
Deferred tax assets	76	96
*Other deferred tax liability allocated to
Development properties 3)	325	277
Provision for taxation for impairment loss / loss carry
forward not yet approved	573	532
Other current assets	8	76
Total	906	885

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 shareholders' equity.

• 2) The appealed Swedish Tax Agency decision of Dec. 15, 2008 relating to final tax for 2006 has not yet been settled by the administrative court. The financial statements include a tax asset of SEK 45m while awaiting the administrative court decision.
• 3) Fiscal difference and carrying amount.
• 4) Comparative figures were restated due to the changed accounting principles regarding revenue recognition in JM International. For more information about IFRIC 15, please see the accounting principles on pages 54–57 and the tables that show the effects of restatement on pages 80–81.

In addition to the above, JM has loss-carryforwards and temporary differences in JM International, which are not reported as deferred tax assets, for SEK 230m, including SEK 123m that is time-based.

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 impairment losses for participations in subsidiaries. Despite established statements in legal entity, a provision at the Group level remains for this risk.

	2010	20091)
Accumulated billing on account for work in progress	12,973	16,688
Recognized revenue in work in progress	–11,759	–15,374
Total	1,214	1,314

1) Comparative figures were restated due to the changed accounting principles regarding revenue recognition in JM International. For more information about IFRIC 15, please see the accounting principles on pages 54–57 and the tables that show the effects of restatement on pages 80–81.

NOT e 29 ACCRUALS AND DEFERRED INCOME
	2010	2009
Personnel-related items	397	393
Prepaid rental income	14	17
Other accruals	349	408
Total	760	818

NOTe 30 PLEDGED ASSETS AND CONTINGENT LIABILITIES

	2010	2009
Assets pledged to secure own provisions and liabilities
Corporate mortgages	100	100
Property mortgages	259	95
Total	359	195
Contingent liabilities
Other guarantees	3,960	3,320
Guarantees in connection with assignments	676	508
Payment and rental guarantees	27	43
Other contingent liabilities	12	12
Total	4,675	3,883

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

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

The Group has an obligation to acquire unsold participations in tenant-owners associations formed by JM six months after final inspection. This obligation ensures that the tenant-owners' association can settle its short-term bank financing. Starting projects in phases, with requirements for a specific level of sales and reservations, reduces the risk of unsold units. See Note 18 Participations in tenant-owners associations, etc. for a summary of this year's purchases and sales.

A tenant-owners association's only revenue is its monthly charges. In the past, JM provided a seven year guarantee to ensure that the association received 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 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. No new guarantees will be issued after the end of 2010.

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 Bostadsgaranti has no liability to pay anything. Bostadsgaranti has not paid out anything since 1962.

Guarantees in connection with assignments largely relate to performance guarantees for contract work with municipalities and municipality-owned companies. These guarantees are in effect during production and for 2–5 years after completion. The commitment initially amounts to 10 percent of the contract price until completion of the work, after which it drops to 5 percent of the contract sum. To the extent that it is considered likely that JM will be held accountable, the commitment is recognized as a liability in the statement of financial position.

NOTe 31 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 71

–PARENT INCOME STATEMENT COMPANY , SEKm	Note	2010	2009
	1
Net sales		6,553	5,990
Production and operating costs	2, 3	–5,465	–4,936
Gross profit		1,088	1,054
Selling and administrative expenses	2, 3, 4	–442	–413
Gains on the sale of properties	5	20	2
Operating profit		666	643
Result from financial items	6
Result from Group companies		–78	–134
Result from associated companies		80	2
Result from other financial assets		4	5
Result from financial current assets		56	53
Interest expenses and similar income statement items		–101	–114
Profit before appropriations and tax		627	455
Appropriations	7	–232	–180
Profit before tax		395	275
Taxes	8	–93	–134
Net profit for the year		302	141

PARENT COMPANY 'S STATEMENT ON COMPREHENSIVE
INCOME , SEKm Note	2010	2009
Net profit for the year	302	141
Other comprehensive income
Group contribution received	53	125
Tax effect on Group contribution	–14	–33
Total other comprehensive income	39	92
Total comprehensive income for the year	341	233

–PARENT CASH FLOW STATEMENT COMPANY , SEKm Note	2010	2009
1
OPERATING ACTIVITIES
Operating profit	666	643
Impairment losses	4	5
Adjustment for non-cash items	–19	12
Sub-total, cash flow from operating activities	651	660
Interest received	56	43
Dividends received	7	4
Interest paid and other financial expenses	–59	–87
Repaid/paid tax	–180	64
Cash flow from operating activities before change in working capital	475	684
Investments in development properties, etc.	–1,508	–1,678
Payment on account for development properties, etc.	1,257	1,915
Increase/decrease in other current receivables, etc.	203	–357
Increase/decrease in other current operating liabilities	–130	460
Cash flow before investments and sales of project properties	297	1,024
Investment in project properties, etc.	1	–8
Sale of project properties, etc.	0	12
Cash flow from operating activities	298	1,028
INVESTING ACTIVITIES
Investment in property, plant, and equipment	0	–9
Investment in Group companies and associated companies, etc.	–183	–291
Change in financial assets	2	9
Cash flow from investing activities	–181	–291
FINANCING ACTIVITIES
Loans raised	84	153
Amortization of debt	-	–9
Dividend	–208	-
Cash flow from financing activities	–124	144
Cash flow for the year	–7	881
Cash and cash equivalents, January 1	1,878	997
Cash and cash equivalents, December 31	1,871	1,878

jm annual report 2010

–PARENT BALANCE SHEET COMPANY , SEKm	Note	Dec. 31, 2010	Dec. 31, 2009
	1
ASSETS
Non-current assets
Plant, property and equipment Machinery and equipment	9	8	11
Financial fixed assets Participations in Group companies	10	1,235	1,145
Non-current interest-bearing receivables in Group companies		-	189
Participations in associated companies		164	124
Non-current receivables in associated companies		43	43
Other non-current receivables		16	19
Deferred tax assets		48 1,506	58 1,578
Total non-current assets		1,514	1,589
Current assets
Project properties	11	11	18
Development properties	11	2,421	2,042
Participations in tenant-owners associations, etc.	12	107	148
Current receivables
Accounts receivable		181	161
Other current receivables		252	193
Current interest-bearing receivables in Group companies Recognized revenue less progress billings	13	1,717 362	1,948 617
Prepaid expenses and accrued income		7	0
		2,519	2,919
Cash and cash equivalents	14	1,871	1,878
Total current assets		6,929	7,005
TOTAL ASSETS		8,443	8,594
EQUITY AND LIABILITIES Shareholders' equity 1)
Share capital		83	83
Restricted equity		83	83
Share premium reserve Undistributed earnings		17 1,756	14 1,664
Net profit for the year		302	141
Unrestricted equity		2,075	1,819
Total shareholders' equity		2,158	1,902
Untaxed reserves	15	829	597
Provisions
Provisions for pensions and similar commitments	16	557	543
Product warranty provisions	17	261	245
		818	788
Liabilities
Non-current liabilities
Non-current interest-bearing liabilities Other non-current liabilities	18	166 178	245 113
		344	358
Current liabilities
Accounts payable		249	151
Current interest-bearing liabilities Other current liabilities	18	203 226	845 323
Current interest-bearing liabilities to Group companies	18	2,085	2,072
Derivatives		1	3
Current tax liabilities		71	67
Progress billings in excess of recognized revenue Accrued expenses and deferred income	19 20	931 528	1,009 479
		4,294	4,949
TOTAL EQUITY AND LIABILITIES		8,443	8,594
Pledged assets	21	169	120
Contingent liabilities	21	5,555	4,773

1) See the Statement of Changes in equity– Parent Company.

statements of changes in equity, NOTES–parent company 73

STATEMENT OF CHANGES IN – PARENT EQUITY COMPANY , SEKm	Share capital	Share premium reserve	Retained earnings	Total share holders' equity
Opening balance, January 1, 2009	83	11	1,569	1,663
Total comprehensive income for the year	-	-	233	233
Equity component of convertible debentures	-	3	-	3
Share-based payments regulated with equity instruments	-	-	3	3
Closing balance, December 31, 2009	83	14	1,805	1,902
Opening balance, January 1, 2010	83	14	1,805	1,902
Total comprehensive income for the year	-	-	341	341
Dividend	-	-	–208	–208
Merger of Group companies	-	-	118	118
Equity component of convertible debentures	-	3	-	3
Share-based payments regulated with equity instruments	-	-	2	2
Closing balance, December 31, 2010	83	17	2 058	2158

Number of shares (1 vote/share) as of December 31, 2010, amounts to 83,401,883 (83,401,883) of which JM AB repurchased 164,825 shares (185,000) which do not participate in dividends. Par value per share is SEK1.

The proposed dividend for 2010 is SEK 4.50 per share (2.50).

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 on pages 54–57.

NOTe 2 EMPLOYEES AND PERSONNEL COSTS

	2010	2009
Average number of employees (all in Sweden)	1,349	1,337
men, %	82	80
Wages, salaries, other remuneration and social security expenses
Board of Directors and President	8	7
(variable compensation)	(2)	(1)
Other employees	599	609
(variable compensation)	(49)	(49)
Total salaries and other remuneration	607	616
(variable compensation)	(51)	(50)
Social security expenses	321	320
(pension costs)	(131)1)	(133)1)
Total Parent Company	928	936

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 3.4 percent (3.5) of regular working hours. Of total absence due to illness, 58 percent (13) comprises absence due to illness for more than 60 days.

Absence due to illness by age, %	2010	2009
–29 years	3.6	5.1
30–49 years	2.7	2.7
50 years and older	4.6	3.9
Absence due to illness by gender, %	2010	2009
Men	3.7	3.9
Women	2.4	2.0

NOTe 3 DEPRECIATION ACCORDING TO PLAN

	2010	2009
Equipment and other tools	–4	–5
Total	–4	–5

The following depreciation rates are applied:

Computers and other equipment 20–33 percent.

NOTe 4 FEES AND REMUNERATION TO AUDITORS 2010 2009

Ernst & Young
Auditing services	3.2	2.9
Other services	0.2	0.1
Total	3.4	3.0

NOTe 5 GAINS ON THE SALE OF PROPERTIES

	2010	2009
Sales values
Project properties	9	7
Development properties	63	32
Total	72	39
Carrying amount
Project properties	-	–5
Development properties	–52	–32
Total	–52	–37
Result
Project properties	9	2
Development properties	11	0
Total	20	2

NOTe 6 RESULT FROM FINANCIAL ITEMS

	Result from Group companies		Result from associated companies		Result from other financial non-current assets		Result from financial current assets		Interest expense and similar profit/loss items			Total
	2010	2009	2010	2009	2010	2009	2010	2009	2010	2009	2010	2009
Dividend	-	-	127	2	4	0	-	-	-	-	131	2
Sales	4	4	6	-	-	1	-	-	-	-	10	5
Impairment loss	–82	–138	–53	-	-	-	-	-	-	-	–135	–138
Interest income	-	-	-	-	-	-	8	9	-	-	8	9
Income, reassessment of derivative	-	-	-	-	-	-	32	16	-	-	32	16
Interest income, Group companies	-	-	-	-	-	4	16	28	-	-	16	32
Interest expense	-	-	-	-	-	-	-	-	–41	–66	–41	–66
Expense, revaluation of derivative Interest portion in this year's	-	-	-	-	-	-	-	-	–33	–27	–33	–27
pension costs	-	-	-	-	-	-	-	-	–27	–21	–27	–21
Total	–78	–134	80	2	4	5	56	53	–101	–114	–39	–188

NOTe 7 APPROPRIATIONS

	2010	2009
Appropriation to tax allocation reserve	–232	–180
Total	–232	–180

NOT e 8	TAXES
		2010	2009
Net profit/loss before taxes		395	275
Current tax		–169	–133
Deferred tax		76	–1

Total tax –93 –134

Difference between reported tax and nominal tax rate 26.3%

Profit before tax 26.3%	–104	–72
Adjustment of tax from previous years	1	–23
Non-taxable income	37	1
Non-deductible expense	–23	–38
Tax untaxed reserve (tax allocation reserve)	–4	–2
Total	–93	–134

In 2008 the Swedish National Tax Agency (Skatteverket) audited JM for tax 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 administrative court, which has not yet ruled in the case. After analysis and with support of an external tax consultant, JM expects that SEK 45m will be refunded; no provision was made 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 impairment losses for participations in subsidiaries. Despite established statements in legal entity, a provision at the Group level remains for this risk.

NOTe 9 MACHINERY AND EQUIPMENT

	2010	2009
Opening cost
Opening balance, January 1	70	67
New purchases	1	9
Sales	-	–6
Closing balance, December 31	71	70
Accumulated depreciation according to plan
Opening balance, January 1	–59	–59
Depreciation for the year	–4	–5
Sales	-	5
Closing balance, December 31	–63	–59
Closing residual value according to plan	8	11

NOTe 11 PROJECT PROPERTIES AND

DEVELOPMENT PROPERTIES
		Project properties		Development properties
	2010	2009	2010	2009
Opening cost
Opening balance, January 1	18	15	2,162	2,656
New purchases	0	8	612	229
Merger	-	-	706	-
Reclassifications	–7	-	–15	-
Transferred to production	-	-	–891	–691
Sales	-	–5	–52	–32
Closing balance, December 31	11	18	2,522	2,162
Accumulated impairment losses
Opening balance, January 1	-	-	–120	–120
Merger	-	-	–15	-
Transferred to production	-	-	34	-
Closing balance, December 31	-	-	–101	–120
Closing residual value according to plan	11	18	2,421	2,042
Tax assessment values	2	1	2,800	2,804

Reported residual value for the part of development properties recognized at fair value amounts to SEK 231m (69).

		Participa tions in Group companies	Long-term interest-bear ing receivables in Group companies		Participa in associated companies	tions		Long-term receivables in associated companies	Other long-term securities			Long-term receivables		Deferred tax receivables		Total
	2010	2009	2010	2009	2010	2009	2010	2009	2010	2009	2010	2009	2010	2009	2010	2009
Opening cost
Opening balance, January 1	1,145	1,141	189	-	124	104	43	43	0	0	19	7	58	59	1,578	1,354
New purchases	302	141	-	-	94	30	-	-	-	-	-	-	-	-	396	171
Additional receivables	-	-	-	189	-	-	-	-	-	-	-	8	-	5	-	202
Settled receivables	-	-	–189	-	-	-	-	-	-	-	–3	–6	–10	–6	–202	–12
Merger	–130	-	-	-	-	-	-	-	-	-	-	-	-	-	–130	-
Reclassification	-	-	-	-	-	–10	-	-	-	-	-	10	-	-	-	-
Sales	-	-	-	-	–1	-	-	-	-	-	-	-	-	-	–1	-
Impairment losses for the year 1)	–82	–137	-	-	–53	-	-	-	-	-	-	-	-	-	–135	–137
Closing balance, December 31	1,235	1,145	-	189	164	124	43	43	0	0	16	19	48	58	1,506	1,578

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 10 FINANCIAL FIXED ASSETS

NOTe 12 PARTICIPATIONS IN TENANT-OWNERS ASSOCIATIONS ETC.

	2010	2009
Opening cost
Opening balance, January 1	148	131
New purchases	323	1,178
Sales	–364	–1,161
Closing balance, December 31	107	148

NOTe 13 RECOGNIZED REVENUE LESS PROGRESS BILLINGS

	2010	2009
Recognized revenue in work in progress	1,756	2,668
Accumulated billing on account for work in progress	–1,394	–2,051
Total	362	617

NOTe 14 CASH AND CASH EQUIVALENTS

	2010	2009
Cash and bank balances	1,171	678
Short-term investments	700	1,200
Total	1,871	1,878

Short-term investments have a maturity of between one day and up to three months.

NOTe 15 UNTAXED RESERVES 2010 2009 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 180 180 Tax allocation reserve, 2011 taxation 232 -

NOTe 16 PROVISIONS FOR PENSIONS AND SIMILAR COMMITMENTS

	2010	2009
Opening balance, January 1	543	538
Benefits earned during the period	11	12
Interest expense	20	19
Pensions paid	–22	–19
Other	5	–7
Closing balance, December 31	557	543

Total 829 597

In the Parent Company the ITP plan is posted as a liability under pension provisions.

NOTe 17 PRODUCTWARRANTY PROVISIONS

	2010	2009
Opening balance, January 1	245	215
Utilized/Reversals	–62	–79
Provisions	78	109
Closing balance, December 31	261	245

NOTe 18 INTEREST-BEARING LIABILITIES

Non-current interest-bearing liabilities	2010	2009
Other liabilities 1–5 years from closing day	55	14
Convertible loan 1–5 years	111	231
Total	166	245
Current interest-bearing liabilities	2010	2009
Other current liabilities	50	845
Convertible loan 1 year	153	-
Liabilities to Group companies	2,085	2,072
Total	2,288	2,917

Other current liabilities 2009 mainly refers to a note payable for SEK 719m for the acquisition of Dalénum in 2007.

Liabilities to credit institutions, confirmed

credits	2010	2009
Bank overdraft facility	400	400
Granted credit agreement maturity within 1 year	650	700
Granted credit agreement maturity more than 1 year	1,750	1,700
Unused part	–2,800	–2,800
Unused credit agreement	-	-

Credit agreements carry fixed interest.

NOT e 19	PROGRESS BILLINGS IN EXCESS RECOGNI ZED REVENUE	OF
		2010	2009
	Accumulated billing on account for work in progress	11,326	14,628
	Recognized revenue in work in progress	–10,395	–13,619
Total		931	1,009

NOTe 20 ACCRUALS AND DEFERRED INCOME

	2010	2009
Personnel-related items	302	298
Prepaid rental income	5	5
Other accruals	221	176
Total	528	479

NOTe 21 PLEDGED ASSETS AND CONTINGENT LIABILITIES

	2010	2009
Assets pledged to secure own provisions
and liabilities
Corporate mortgages 1)	100	100
Property mortgages	69	20
Total	169	120
Contingent liabilities
Guarantee commitments, other 2)	3,960	3,321
Guarantees on behalf of Group companies 3)	1,207	1,205
Guarantees in connection with assignments	367	230
Payment and rental guarantees	9	5
Other contingent liabilities	12	12
Total	5,555	4,773

1, 2) See the Group's note 30 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.

NOTe 22 RELATED PARTY DISCLOSURES

The Parent Company has a related party relationship with its subsidiaries and associated companies, see Group notes 14 and 16.

	2010	2009
Purchase of goods and services from related parties	437	518
Interest income from Group companies	16	32
Interest expense to Group companies	0	0
Interest expenses to associated companies	–1	-
Dividend from associated companies	127	2
Long-term receivables from Group companies	-	189
Long-term receivables from associated companies	43	43
Current receivables from Group companies	1,717	1,948
Current liabilities to Group companies	2,085	2,072
Guarantees on behalf of Group companies	1,207	1,205

Transactions with key individuals in leading position can be found in note 2, Employees and personnel costs. All transactions with related parties and companies were conducted on market-based terms.

76 five-year overview–group

Amounts in SEK million unless stated otherwise.

INCOME STATEMENT 1)	2010	2009	2008	2007	2006
Income	9,136	9,620	12,229	12,731	12,065
Production and operating costs	–7,608	–8,361	–10,180	–9,939	–9,737
Gross profit	1,528	1,259	2,049	2,792	2,328
Selling and administrative expenses	–649	–615	–719	–673	–616
Gains on the sale of properties	28	89	73	182	169
Impairment losses on properties	-	–87	–320	-	-
Operating profit	907	646	1,083	2,301	1,881
Financial income and expenses	–67	–117	–31	–4	–29
Profit before tax	840	529	1,052	2,297	1,852
Taxes	–246	–164	–234	–632	–284
Net profit for the year	594	365	818	1,665	1,568
INCOME STATEMENT BY FUNCTION
Production
Recognized revenue	9,016	9,486	12,027	12,555	11,894
Production costs	–7,498	–8,237	–10,002	–9,805	–9,609
Profit from production operations	1,518	1,249	2,025	2,750	2,285
Development properties
Rental income	58	65	85	94	95
Operating expenses	–38	–34	–57	–58	–67
Property tax	–21	–21	–21	–18	–14
Profit from development properties	–1	10	7	18	14
Project properties
Rental income	62	69	117	82	76
Operating expenses	–48	–66	–98	–56	–46
Property tax	–3	–3	–2	–2	–1
Profit from project properties	11	0	17	24	29
Gross profit	1,528	1,259	2,049	2,792	2,328
Selling and administrative expenses	–614	–569	–662	–624	–571
Property sales
Sales values	80	665	748	653	1,000
Carrying amount	–52	–576	–675	–471	–831
Gains on the sale of properties	28	89	73	182	169
Impairment losses on properties	-	–87	–320	-	-
Group-wide expenses	–35	–46	–57	–49	–45
Operating profit	907	646	1,083	2,301	1,881
BALANCE SHEET 1)	Dec 31, 2010	Dec 31, 2009	Dec 31, 2008	Dec 31, 2007	Dec 31, 2006
ASSETS
Non-current assets	219	259	184	121	118
Project properties	661	596	614	790	823
Development properties	5,374	4,990	5,620	5,282	4,348
Participations in tenant-owners associations, etc.	115	353	171	104	73
Current receivables 2)	1,437	1,659	2,355	1,558	1,535
Cash and cash equivalents	2,087	2,030	1,111	2,061	1,509
Total current assets	9,674	9,628	9,871	9,795	8,288
TOTAL ASSETS	9,893	9,887	10,055	9,916	8,406
EQUITY AND LIABILITIES 3)
Shareholders' equity	3,923	3,637	3,241	3,893	3,590
Long-term interest-bearing liabilities	258	326	314	216	73
Other non-current liabilities	218	113	271	978	597
Long-term provisions	1,833	1,682	1,579	1,358	938
Total non-current liabilities	2,309	2,121	2,164	2,552	1,608
Current interest-bearing liabilities	514	951	1,137	45	114
Other current liabilities	3,036	3,045	3,401	3,321	3,024
Current provisions	111	133	112	105	70
Total current liabilities	3,661	4,129	4,650	3,471	3,208
TOTAL EQUITY AND LIABILITIES	9,893	9,887	10,055	9,916	8,406
1) Financial year 2008 and earlier are not restated according to IFRIC 15.
2) Of which receivables from property sales	35	3	474	64	2
3) Of which liabilities for property acquisition	508	962	1,140	1,600	998

CASH FLOW STATEMENT	2010	2009	2008	2007	2006
Cash flow from operating activities	42	1,124	101	1,826	667
Cash flow from investing activities	7	–51	–4	–7	–7
Cash flow from financing activities	13	–158	–1,055	–1,279	–1,782
Total cash flow for the year	62	915	–958	540	–1,122
Cash and cash equivalents, December 31	2,087	2,030	1,111	2,061	1,509
INTEREST -BEARING NET LIABILITIES /RECEIVABLES
Interest-bearing net liabilities (+)/receivables (–), January 1	–189	842	–1,313	–852	–1,536
Change in interest-bearing net liabilities/receivables	–541	–1,031	2,155	–461	684
Interest-bearing net liabilities (+)/receivables (–), December 31	–730	–189	842	–1,313	–852
DEVELOPMENT PROPERTIES
Carrying amount, January 1	4,990	5,620	5,282	4,348	2,925
New purchases	1,655	428	1,571	2,130	2,718
Transferred to production	–1,080	–910	–781	–1,159	–1,168
Impairment losses	-	–87	–320	-	-
Other	–191	–61	–132	–37	–127
Carrying amount, December 31	5,374	4,990	5,620	5,282	4,348
Housing production
Number of available building rights	27,500	27,900	31,000	31,000	29,800
–recognized in the balance sheet	17,600	18,400	20,100	19,200	19,300
Number of residential units sold	3,276	3,291	1,871	3,880	3,790
Number of housing starts	3,404	2,150	1,829	4,065	4,132
PRO JECT PROPERTIES
Market values	685	610	669	1,052	1,063
Carrying amount	661	596	614	790	823
Surplus values before deferred tax	24	14	55	262	240
PERSONNEL
Average number of employees	2,043	2,095	2,533	2,385	2,286
–abroad	246	247	353	318	343
Wages, salaries and remunerations	924	969	1,086	982	888
1) KEY FIGURES
Operating margin (%) 2)	9.9	6.7	8.9	18.1	15.6
Return on equity after tax (%)	15.7	10.6	22.9	44.5	45.4
Pre-tax return on capital employed (%)	17.8	12.9	23.8	52.9	44.4
Pre-tax return on total capital (%)	9.7	6.9	11.7	25.7	23.3
Equity/assets ratio (%) 2)	40	37	32	39	43
Interest-bearing loan (SEKm)	1,357	1,842	1,964	760	669
Debt/equity ratio (times)	-	-	0.3	-	-
Interest coverage ratio (times)	8.1	4.3	9.8	39.9	25.4
Interest-bearing liabilities/total assets (%)	14	19	20	8	8
Asset turnover rate (times)	0.92	0.97	1.22	1.39	1.46

1) Financial year 2008 and earlier are not restated according to IFRIC 15. 2) 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

78 quarterly overview–group

Amounts in SEK million unless stated otherwise.

			2010					2009
INCOME STATEMENT 1)	Full-year	Q 4	Q 3	Q 2	Q 1	Full-year	Q 4	Q 3	Q 2	Q 1
Income	9,136	3,075	1,947	2,406	1,708	9,620	2,493	1,733	2,492	2,902
Production and operating costs	–7,608	–2,532	–1,618	–2,030	–1,428	–8,361	–2,070	–1,447	–2,198	–2,646
Gross profit	1,528	543	329	376	280	1,259	423	286	294	256
Selling and administrative expenses	–649	–172	–137	–175	–165	–615	–150	–115	–181	–169
Gains on the sale of properties	28	11	3	7	7	89	38	10	28	13
Impairment losses on properties	-	-	-	-	-	–87	-	-	–87	-
Operating profit	907	382	195	208	122	646	311	181	54	100
Financial income and expenses	–67	–11	–20	–7	–29	–117	–22	–31	–34	–30
Profit before tax	840	371	175	201	93	529	289	150	20	70
Taxes	–246	–106	–51	–59	–30	–164	–91	–46	–7	–20
Net profit for the period	594	265	124	142	63	365	198	104	13	50
		Dec 31,	Sep 30,	Jun 30,	Mar 31,		Dec 31,	Sep 30,	Jun 30,	Mar 31,
BALANCE SHEET 1)		2010	2010	2010	2010		2009	2009	2009	2009
ASSETS
Non-current assets		219	252	256	254		259	272	148	113
Project properties		661	670	647	622		596	804	731	636
Development properties		5,374	4,882	4,954	4,993		4,990	5,203	5,391	5,623
Participations in tenant-owners associations, etc.		115	138	166	301		353	307	416	290
Current receivables		1,437	1,629	1,755	1,710		1,659	2,025	2,129	2,550
Cash and cash equivalents		2,087	1,826	1,747	2,190		2,030	1,084	1,294	858
Total current assets		9,674	9,145	9,269	9,816		9,628	9,423	9,961	9,957
TOTAL ASSETS		9,893	9,397	9,525	10,070		9,887	9,695	10,109	10,070
EQUITY AND LIABILITIES
Shareholders' equity		3,923	3,661	3,577	3,657		3,637	3,412	3,337	3,341
Long-term interest-bearing liabilities		258	258	236	324		326	306	323	315
Other non-current liabilities		218	124	125	155		113	236	236	271
Long-term provisions		1,833	1,742	1,717	1,692		1,682	1,666	1,521	1,512
Total non-current liabilities		2,309	2,124	2,078	2,171		2,121	2,208	2,080	2,098
Current interest-bearing liabilities		514	574	532	1,178		951	793	1,212	1,349
Other current liabilities		3,036	2,913	3,211	2,936		3,045	3,158	3,365	3,162
Current provisions		111	125	127	128		133	124	115	120
Total current liabilities		3,661	3,612	3,870	4,242		4,129	4,075	4,692	4,631
TOTAL EQUITY AND LIABILITIES		9,893	9,397	9,525	10,070		9,887	9,695	10,109	10,070
			2010					2009
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	42	305	–27	–148	–88	1,124	780	179	629	–464
Cash flow from investing activities	7	11	–4	0	0	–51	–7	–3	–45	4
Cash flow from financing activities	13	–55	112	–293	249	–158	172	–386	–147	203
Total cash flow for the period	62	261	81	–441	161	915	945	–210	437	–257
Cash and cash equivalents at
end of the period	2,087	2,087	1,826	1,747	2,190	2,030	2,030	1,084	1,294	858
INTEREST -BEARING NET LIABILITIES	/RECEIVABLES
Interest-bearing net liabilities (+)/
receivables (–) at beginning of period	–189	–409	–400	–115	–189	842	536	763	1 313	842
Change in interest-bearing net
liabilities/receivables	–541	–321	–9	–285	74	–1,031	–725	–227	–550	471
Interest-bearing net liabilities (+)/ receivables (–) at end of period	–730	–730	–409	–400	–115	–189	–189	536	763	1,313
DEVELOPMENT PROPERTIES
Opening balance at beginning of
period	4,990	4,882	4,954	4,993	4,990	5,620	5,203	5,391	5,623	5,620
New purchases Transferred to production	1,655 –1,080	933 –424	183 –184	290 –281	249 –191	428 –910	185 –377	103 –233	98 –175	42 –125
Impairment losses	-	-	-	-	-	–87	-	-	–87	-
Other	–191	–17	–71	–48	–55	–61	–21	–58	–68	86
Closing balance at end of period	5,374	5,374	4,882	4,954	4,993	4,990	4,990	5,203	5,391	5,623
KEY FIGURES 1)
Operating margin (%)	9.9	12.4	10.0	8.6	7.1	6.7	12.5	10.4	2.2	3.4
Debt/equity ratio (times)	-	-	-	-	-	-	-	0.2	0.2	0.4
Equity/assets ratio (%)	40	40	39	38	36	37	37	35	33	33
Earnings per share (SEK) Number of available building rights	7.10 27,500	3.20 27,500	1.50 26,700	1.70 27,400	0.80 27,600	4.40 27,900	2.40 27,900	1.30 29,000	0.20 30,500	0.60 30,600
Number of residential units sold	3,276	1,056	758	705	757	3,291	908	879	940	564
Number of housing starts	3,404	972	811	872	749	2,150	704	763	536	147

1) Comparative figures for 2009 were restated due to the changed accounting principles regarding revenue recognition in JM International. For more information about IFRIC 15, please see the accounting principles on pages 54–57 and the tables that show the effects of restatement on pages 80–81.

quarterly overview–business segments 79

			2010					2009
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	3,824	1,350	819	899	756	3,330	989	696	754	891
Operating profit 1)	634	266	123	133	112	496	170	101	105	120
Operating margin (%)	16.6	19.7	15.0	14.8	14.8	14.9	17.2	14.5	13.9	13.5
Average operating capital	1,776	1,776	1,765	1,817	1,938	1,981	1,981	2,090	2,130	2,184
Return on operating capital (%) 2)	35.7	35.7	30.5	28.4	25.2	25.0	25.0	19.8	22.4	34.3
Operating cash flow	–34	169	–44	–291	132	544	226	92	310	–84
Carrying amount, development properties Number of available building rights	2,562 11,100	2,562 11,100	2,100 10,000	2,155 10,500	2,122 10,700	2,111 10,700	2,111 10,700	2,253 11,200	2,354 12,200	2,376 11,800
Number of residential units sold3)	1,408	477	274	299	358	1,713	456	538	434	285
Number of housing starts 4)	1,604	414	399	427	364	1,102	360	461	190	91
1) Of which property sales	2	2	-	-	-	2	2	-	-	-
3) Of which rental units	211	104	-	62	45	562	107	224	70	161
4) Of which rental units	211	104	-	62	45	492	107	224	70	91
			2010					2009
JM RESIDENTIAL SWEDEN	Full-year	Q 4	Q 3	Q 2	Q 1	Full-year	Q 4	Q 3	Q 2	Q 1
Income	2,749	819	604	785	541	2,296	654	424	646	572
Operating profit 1)	219	73	54	58	34	166	80	39	35	12
Operating margin (%)	8.0	8.9	8.9	7.4	6.3	7.2	12.2	9.2	5.4	2.1
Average operating capital	1,471	1,471	1,465	1,540	1,601	1,597	1,597	1,600	1,633	1,617
Return on operating capital (%) 2)	14.9	14.9	15.4	13.7	11.7	10.4	10.4	–2.2	–0.9	4.8
Operating cash flow	312	–165	230	125	122	70	–35	212	151	–258
Carrying amount, development properties	1,497	1,497	1,422	1,429	1,518	1,451	1,451	1,509	1,500	1,547
Number of available building rights Number of residential units sold	9,600 1,207	9,600 352	9,800 354	10,200 276	10,100 225	10,200 973	10,200 258	10,100 203	10,700 300	11,000 212
Number of housing starts	1,230	350	338	321	221	689	225	237	181	46
1) Of which property sales	0	-	-	0	-	0	-	0	0	-
JM INTERNATIONAL	Full-year	Q 4	2010 Q 3	Q 2	Q 1	Full-year	Q 4	2009 Q 3	Q 2	Q 1
Income Operating profit 1)	1,570 48	457 28	369 11	408 8	336 1	1,353 –192	484 9	284 4	321 –136	264 –69
Operating margin (%)	3.1	6.1	3.0	2.0	0.3	–14.2	1.9	1.4	–42.4	–26.1
Average operating capital	1,838	1,838	1,870	1,895	1,948	1,936	1,936	1,937	1,977	1,965
Return on operating capital (%) 2)	2.6	2.6	1.6	1.2	–6.3	–9.9	–9.9	–22.9	–21.7	–13.5
Operating cash flow	236	184	1	126	–75	–174	–115	97	39	–195
Carrying amount, development properties	1,255	1,255	1,252	1,263	1,245	1,320	1,320	1,361	1,457	1,620
Carrying amount, project properties	34	34	34	35	35	32	32	31	60	68
Number of available building rights Number of residential units sold3)	6,800 661	6,800 227	6,900 130	6,700 130	6,800 174	7,000 605	7,000 194	7,700 138	7,600 206	7,800 67
Number of housing starts 4)	570	208	74	124	164	359	119	65	165	10
1) Of which –property sales –impairment losses on properties	- -	- -	- -	- -	- -	12 –87	2 -	10 -	- –87	- -
3) Of which rental units	-	-	-	-	-	48	-	14	34	-
4) Of which rental units	-	-	-	-	-	48	-	14	34	-
			2010					2009
JM PROPERTY DEVELOPMENT	Full-year	Q 4	Q 3	Q 2	Q 1	Full-year	Q 4	Q 3	Q 2	Q 1
Income	72	16	15	15	26	309	60	100	76	73
Operating profit 1)	12	2	3	6	1	110	42	16	28	24
Average operating capital	708	708	798	845	922	1,021	1,021	1,081	1,031	1,016
Return on operating capital (%) 2)	1.7	1.7	6.5	7.7	9.4	10.8	10.8	10.2	10.0	9.3
Operating cash flow	–118	–8	–24	–60	–26	620	571	–181	127	103
Carrying amount, development properties	60	60	108	107	108	108	108	80	80	80
Carrying amount, project properties	625	625	636	612	587	564	564	773	671	568
1) Of which property sales	26	9	3	7	7	75	34	-	28	13
JM PRODUCTION	Full-year	Q 4	2010 Q 3	Q 2	Q 1	Full-year	Q 4	2009 Q 3	Q 2	Q 1
Income Operating profit	1,496 91	405 38	311 18	431 21	349 14	2,008 130	478 37	450 34	577 37	503 22
Operating margin (%)	6.1	9.4	5.8	4.9	4.0	6.5	7.7	7.6	6.4	4.4
Operating cash flow	36	64	–24	16	–20	173	85	65	–39	62
			2010					2009
JM OTHER	Full-year	Q 4	Q 3	Q 2	Q 1	Full-year	Q 4	Q 3	Q 2	Q 1
Income (elimination)	–437	–115	–106	–121	–95	–518	–126	–136	–72	–184
Operating profit (Group-wide expenses)	–35	–10	–5	–9	–11	–46	–13	–6	–14	–13
			2010					2009
5) RESTATEMENT JM INTERNATIONAL	Full-year	Q 4	Q 3	Q 2	Q 1	Full-year	Q 4	Q 3	Q 2	Q 1
Income	–138	143	–65	–11	–205	842	–46	–85	190	783
Operating profit	–62	–15	–9	–9	–29	–18	–14	–7	–1	4

2) Calculated on 12-month rolling profits and average capital.

5) Effect of changed policy for income and profit and loss (IFRIC 15) relating to JM International. For more information about IFRIC 15,

please see the accounting principles on pages 54–57 and the tables that show the effects of restatement on pages 80–81.

GROUP

EFFECTS OF THE TRANSITION ON 2009 INCOME STATEMENT AND BALANCE SHEET ACCORDING TO IFRIC 15

INCOME STATEMENT	Jan–Dec 2009	Restatement 1)	Restated Jan–Dec 2009
Income	8,778	842	9,620
Production and operating costs	–7,501	–860	–8,361
Gross profit	1,277	–18	1,259
Selling and adminstrative expenses	–615	-	–615
Gains on the sale of properties	89	-	89
Impairment losses on properties	–87	-	–87
Operating profit	664	–18	646
Financial income and expenses	–117	-	–117
Profit before tax	547	–18	529
Tax	–168	4	–164
Net profit for the year	379	–14	365
Other comprehensive income
Translation differences	42	–1	41
Total comprehensive income for the year	421	–15	406

BALANCE SHEET	Dec 31, 2009	Restate ment 1)	Restated Dec 31, 2009	Dec 31, 2008	Restate ment 1)	Restated Jan 1, 2009
Assets
Non-current assets	258	1	259	184	3	187
Project properties	596	-	596	614	-	614
Development properties	4,990	-	4,990	5,620	-	5,620
Participations in tenant-owners associations etc.	353	-	353	171	-	171
Current receivables	1,703	–44	1,659	2,355	–34	2,321
Cash and cash equivalents	2,030	-	2,030	1,111	-	1,111
Total current assets	9,672	–44	9,628	9,871	–34	9,837
Total assets	9,930	–43	9,887	10,055	–31	10,024
Equity and liabilities
Shareholders' equity	3,668	–31	3,637	3,241	–16	3,225
Non-current interest-bearing liabilities	326	-	326	314	-	314
Other non-current liabilities	113	-	113	271	-	271
Non-current provisions	1,693	–11	1,682	1,579	–3	1,576
Total non-current liabilities	2,132	–11	2,121	2,164	–3	2,161
Current interest-bearing liabilities	951	-	951	1,137	-	1,137
Other current liabilities	3,046	–1	3,045	3,401	–12	3,389
Current provisions	133	-	133	112	-	112
Total current liabilities	4,130	–1	4,129	4,650	–12	4,638
Total shareholders' equity and liabilities	9,930	–43	9,887	10,055	–31	10,024
KEY FIGURES	Dec 31, 2009		Restated Dec 31, 2009
Operating margin (%)	7.6		6.7
Equity/assets ratio (%)	37		37
Earnings per share (SEK)	4.60		4.40

CONSOLIDATED STATEMENT OF

­CHANGES IN EQUITY	Jan–Dec 2009	Restatement 1)	Restated Jan–Dec 2009
Opening balance at beginning of the year	3,241	-	3,241
Effect of change in accounting principle, IFRIC 15	-	–16	–16
Total comprehensive income for the year	421	–15	406
Equity component of convertible debentures	3	-	3
Share-based payments regulated with
equity instruments	3	-	3
Closing balance at end of the year	3,668	–31	3,637

1) Effect of changed accounting principles regarding revenue recognition (IFRIC 15) relating to JM International.

GROUP

EFFECTS OF THE TRANSITION ON 2009 INCOME STATEMENT AND BALANCE SHEET ACCORDING TO IFRIC 15 QUARTERLY OVERVIEW, SEK m

INCOME STATEMENT	Q4 2009	Restate ment 1)	Re stated Q4	Q3 2009	Restate ment 1)	Re stated Q3	Q2 2009	Restate ment 1)	Re stated Q2	Q1 2009	Restate ment 1)	Re stated Q1
Income	2,539	–46	2,493	1,818	–85	1,733	2,302	190	2,492	2,119	783	2,902
Production and operating costs	–2,102	32	–2,070	–1,525	78	–1,447	–2,007	–191	–2,198	–1,867	–779	–2,646
Gross profit	437	–14	423	293	–7	286	295	–1	294	252	4	256
Selling and administrative expenses	–150	-	–150	–115	-	–115	–181	-	–181	–169	-	–169
Gains on the sale of properties	38	-	38	10	-	10	28	-	28	13	-	13
Impairment losses on properties	-	-	-	-	-	-	–87	-	–87	-	-	-
Operating profit	325	–14	311	188	–7	181	55	–1	54	96	4	100
Financial income and expenses	–22	-	–22	–31	-	–31	–34	-	–34	–30	-	–30
Profit before tax	303	–14	289	157	–7	150	21	–1	20	66	4	70
Tax	–94	3	–91	–48	2	–46	–7	-	–7	–19	–1	–20
Net profit for the period	209	–11	198	109	–5	104	14	–1	13	47	3	50

BALANCE SHEET	Dec 31, 2009	Restate ment 1)	Re stated Dec 31	Sep 30, 2009	Restate ment 1)	Re stated Sep 30	Jun 30, 2009	Restate ment 1)	Re stated Jun 30	Mar 31, 2009	Restate ment 1)	Re stated Mar 31
Assets
Non-current assets	258	1	259	271	1	272	147	1	148	109	4	113
Project properties	596	-	596	804	-	804	731	-	731	636	-	636
Development properties	4,990	-	4,990	5,203	-	5,203	5,391	-	5,391	5,623	-	5,623
Participations in tenant owners associations etc.	353	-	353	307	-	307	416	-	416	290	-	290
Current receivables	1,703	–44	1,659	2,054	–29	2,025	2,154	–25	2,129	2,583	–33	2,550
Cash and cash equivalents	2,030	-	2,030	1,084	-	1,084	1,294	-	1,294	858	-	858
Total current assets	9,672	–44	9,628	9,452	–29	9,423	9,986	–25	9,961	9,990	–33	9,957
Total assets	9,930	–43	9,887	9,723	–28	9,695	10,133	–24	10,109	10,099	–29	10,070
Equity and liabilities
Shareholders' equity	3,668	–31	3,637	3,431	–19	3,412	3,352	–15	3,337	3,355	–14	3,341
Non-current interest-bearing liabilities	326	-	326	306	-	306	323	-	323	315	-	315
Other non-current liabilities	113	-	113	236	-	236	236	-	236	271	-	271
Current provisions	1,693	–11	1,682	1,673	–7	1,666	1,526	–5	1,521	1,514	–2	1,512
Total current liabilities	2,132	–11	2,121	2,215	–7	2,208	2,085	–5	2,080	2,100	–2	2,098
Current interest-bearing liabilities	951	-	951	793	-	793	1,212	-	1,212	1,349	-	1,349
Other current liabilities	3,046	–1	3,045	3,160	–2	3,158	3,369	–4	3,365	3,175	–13	3,162
Current provisions	133	-	133	124	-	124	115	-	115	120	-	120
Total current liabilities	4,130	–1	4,129	4,077	–2	4,075	4,696	–4	4,692	4,644	–13	4,631
Total shareholders' equity and liabilities	9,930	–43	9,887	9,723	–28	9,695	10,133	–24	10,109	10,099	–29	10,070
KEY FIGURES	Q4 2009		Re stated Q4	Q3 2009		Re stated Q3	Q2 2009		Re stated Q2	Q1 2009		Re stated Q1
Operating margin (%)	12.8		12.5	10.3		10.4	2.4		2.2	4.5		3.4
Equity/assets ratio (%)	37		37	35		35	33		33	33		33
Earnings per share (SEK)	2.50		2.40	1.30		1.30	0.20		0.20	0.60		0.60

1) Effect of changed accounting principles regarding revenue recognition (IFRIC 15) relating to JM International.

The Board of Directors and the President propose that the Parent Company's net profit for the year of SEK 302,209,893 and retained earnings of SEK 1,772,794,838, for a total of SEK 2,075,004,731, be distributed as follows:

Dividend to shareholders: SEK 4.50 per share SEK 374,579,415

to be carried forward to new account SEK 1,700,425,316 SEK 2,075,004,731

The number of registered shares as of February 28, 2011 was 83,404,177, including 164,307 at this time that are repurchased shares and 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 22, 2011

Lars Lundquist Chairman of the Board

Elisabet Annell Anders Narvinger Kia Orback Pettersson Board member Board member Board member

Åsa Söderström Jerring Torbjörn Torell Jonatan Sundelin

Board member Board member Board member appointed by the employees

Board member appointed Board member

Johan Wegin Johan Skoglund by the employees President and Chief Executive Officer

STATEMENT BY THE BOARD OF DIRECTORS PURS UANT TO THE SWEDIS H COMPANIES ACT, CHAPTER 18 SECTION 4 ON T HE PROPOSED DIVIDEND FOR 2010

At the end of 2010 the financial position was strong. The Group's interestbearing receivables totaled SEK 0.7 billion.

The proposed dividend to shareholders decreases the Group's visible equity/assets ratio from 40 to 37 percent and the Parent Company's visible equity/assets ratio from 33 to 30 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.

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 9, 2011

JM AB ( publ ) Board of Directors

To the annual meeting of the share holders of JM AB, Corporate identity number 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 AB for the year 2010. The Company's annual accounts and consolidated financial statements are included in the printed version of this document on pages 43-82. 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 IFRSs 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 that the 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 IFRSs 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 income statement and balance sheets for 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 22 ,2011

Ernst & Young AB

Ingemar Rindstig Jonas Svensson Accountant Accountant

Authorized Public Authorized Public

DEFINITIONS KEY FINANCIAL FIGURES

Amounts in SEKm unless stated otherwise.

Dividend yield

Proposed dividend in relation to market price at December 31, 2010.

Proposed dividend	SEK 4.50
Share price	SEK 157.50
	2.9%

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 34.50
Dividend paid	SEK 2.50
Share price, January 1	SEK 123
	30%

Asset turnover rate

Income divided by average total assets.

Income	9,136
Average total assets	9,890
	0.92 times

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	594
Average number of shares	83,229,492
	SEK 7.10

Return on equity

Profit for the year as a percentage of average shareholders' equity.
Net profit for the year	594
Average shareholders' equity	3,780
	15.7%

Return on capital employed

Profit before tax plus financial expenses as a percentage of average capital employed.
Profit before tax plus financial expenses	958
Average capital employed	5,380
	17.8%

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	958
Average total assets	9,890
	9.7%

Interest coverage ratio

Profit before tax plus financial expenses in relation to financial expenses.
Profit before tax plus financial expenses	958
Finance expenses	118
	8.1 times

Operating margin

Operating result including property sales and impairment losses on properties in relation to revenues.

Operating profit	907
Income	9,136
	9.9%

Equity/assets ratio

Shareholders' equity as a percentage of total assets.

Shareholders' equity	3,923
Total assets	9,893
	40%

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 97–98.

Revenue

Rental income and recognized revenue according to the percentage of completion method. Outside Sweden, accrued revenue are usually reported at the time the home is transferred to the customer.

Operating capital

Total goodwill, project properties, development properties, participations in tenantowners associations etc., receivables from property sales, receivables from tenantowners associations sold, and accounts receivable, revenue less progress billings minus accounts payable, liabilities to tenant-owners associations 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 page 99.

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 interest-bearing 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 pages 54–57.

contents	page
corporate governance report	85
board of directors and auditors	92
execu tive management	93
the jm share	94
notice of annual general meeting and financial calendar	96

CORPORATE GO VERNANCE REPORT FOR THE 2010 FINANCIAL YEAR

CORPORATE GOVERNAN CE PRINCIPLES

In addition to the rules laid down by law or regulation, JM applies Swedish Code of Corporate Governance (the Code). 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.

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 2010 Annual General Meeting was held on April 28. A total of 46 shareholders were present or represented by representatives, representing about 48 percent of the total votes. Minutes from the Annual General Meeting can be found on JM's website (www.jm.se). The 2011 Annual General Meeting will be held on April 28.

The following shareholder has a direct or indirect shareholding in the Company, who represent at least one tenth of the voting rights for all shares i the Company: AMF Pension.

JM's Articles of Association include no limitations on the number of votes each shareholder may cast at the general meeting.

The Articles of Association do not contain any provisions on the appointment and dismissal of Board members or on amendments to the articles.

The AGM has not authorized the Board to issue new shares or acquire treasury shares.

JM does not apply any special arrangements relating to the function of the annual meeting of shareholders, either due to provisions in the Articles of Association or, as far as is known to the Company, shareholder agreements.

NOMINATION COMMITTEE

Board Members are nominated by the 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 2011 Annual General Meeting in September 2010 and it consists of the following:

Lars-Åke Bokenberger representing AMF Pension KG Lindvall representing Swedbank Robur Funds Anders Algotsson representing AFA Försäkringar

Thomas Ehlin representing Nordea Fonder

Lars Lundquist, Chairman of the Board of JM.

At the time it was appointed, the Nomination Committee represented about 31 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.

Members of 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, Jernhusen, Einar Mattsson, Sagax, Svenska Bostäder, Vasakronan and Vasallen.

In addition to JM, Jonas Svensson provides auditing services to clients such as Besqab, ByggPartner, Elektronikgruppen, 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 62.

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. No deputies shall be appointed. 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 2010 Annual General Meeting elected seven directors. The employee organizations have appointed two Directors and two deputies.

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 2010.

Approved remuneration is reported on pages 89–90. The Board of Directors held twelve meetings.

The Audit Committee held four meetings.

The Compensation Committee held six meetings.

The Investment Committee held seven meetings.

Name	Function		Elected Committee	Attend ance B	Attend ance C
Lars Lundquist	Chairman	2005	(chairman) C (chairman) I	11	6 6
Elisabet Annell	Board member 2002		(chairper son) A	10	4
Anders Narvinger	Board member 2009		A	11	4
Kia Orback Pettersson	Board member 2010		A1)	71)	21)
Johan Skoglund	Board member 2003		2)	11	2)
Åsa Söderström Jerring Board member 2007			C I	12	5 5
Torbjörn Torell	Board member 2004		I	11	7
Jonatan Sundelin	Emp. rep.	2004	-	12
Johan Wegin	Emp. rep.	2002	-	12
Peter Skogert	Emp. rep., dep.	2005	-	12
Stefan Brodén	Emp. rep., dep.	2007	-	12

1) Kia Orback Pettersson was elected to the Board of Directors at the 2010 Annual General Meeting and has been present at the seven meetings and two committee meetings held thereafter.

2) Although Johan Skoglund is not a member of any of the Board's committees, he attended the committee meetings together with the reporting business unit manager and chief of staff.

Further information about the Board's Directors according to article 2.6 in the Code is specified on page 92.

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 evaluation is 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 2010

Among other things, in 2010 the Board of Directors decided on housing starts for six residential projects, which have an estimated total project expense exceeding the maximum level delegated to the President of SEK 400 million per project.

The Board of Directors also decided on five acquisitions of development properties, which have a purchase sum exceeding the maximum level delegated to the President of SEK 100 million.

The Board of Directors also decided to set forth proposals to the Annual General Meeting on long-term variable salary programs, which will be performance-based and share or cashrelated, as well as a convertible debenture and warrant program for all personnel in the Group equivalent to programs offered in previous years.

The Board of Directors held a separate strategy meeting at which it adopted the strategic plan for the Company. JM's policies and guidelines were addressed at the strategy meeting and a competitor analysis was reviewed.

Incident reporting system

The Board of Directors implemented an incident reporting system to deal with incidents systematically and professionally. An incident is defined as a suspected or actual irregularity. An irregularity is defined as an action carried out with the intention of personal gain or some other motive that directly or indirectly entails damage for JM. Information about ongoing incident investigations will be presented at the Audit Committee's quarterly meetings.

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 discusses the plan for the work of the external auditors and approves the internal audit. 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. Chairperson of the Audit Committee is Elisabet Annell.

The Director of Human Resources reports for the Compensation Committee. Each business unit manager reports for the Investment Committee. The Chief Financial Officer reports for the Audit Committee.

The Audit Committee

The Audit Committee was established in 2003 and currently has three members: Elisabet Annell (Chairperson), Anders Narvinger and Kia Orback Pettersson.

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 has two members: Lars Lundquist (Chairman) and Åsa Söderström Jerring. The Committee held six 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 convertible bond and warrant programs that will be presented 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 has three members: Lars Lundquist (Chairman), Torbjörn Torell and Åsa Söderström Jerring. The Committee has held seven meetings during the year.

The Investment Committee's duties during the year have been, within the framework of JM's order of delegation, to:

• • Evaluate the strategy for scope and focus pertaining to development properties and project properties
• • Prepare recommendations to purchase or sell development properties and project properties or shares and participation rights in companies as owner of such properties
• • Prepare recommendations relating to investments in existing project properties
• • Prepare recommendations relating to production start of housing projects
• • Prepare recommendations relating to external contractors.

FINANCIAL REPORTING

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 is presented in section Monitoring below.

THE BOARD OF DIRECTORS ' DESCRIPTION OF INTERNAL CONTROL AND RISK MANAGE MENT OVER FINANCIAL REPORTING Governance Structure

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 pages 38-41.

The Governance Structure can be seen below:

In recent years the Board of Directors has placed special emphasis on building effective control structures. Risk reporting was developed during the year through further systematic follow-up of macroeconomic, operational and financial risks. Follow-up focuses on trend changes as measured by probability and materiality criteria.

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 Norwegian operation implemented the group-wide business system and associated processes during the year.

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 projetcs, comprices 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 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, heads of corporate staff units 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,

The decision process can be seen below:

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
• • Treasury 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, 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 and senior executives

After a recommendation from the Nomination Committee the 2010 Annual General Meeting resolved to leave fees unchanged as follows:

• • the Chairman of the Board should be paid a fee of SEK 590,000 and regular Director who is not employed by the Company will be paid SEK 260,000
• • the fee for work in the Audit Committee should be SEK 110,000 to the Chairperson and SEK 80,000 to the Directors, and SEK 55,000 be paid to the respective Chairs of the Compensation and Investment Committees.

Recommendations for compensation guidelines for JM's senior executives will be presented as required by law at the 2011 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 60–61 of Notes to the financial statements.

About 650 of JM's managers and leaders, including the President and Executive Management participate in a performancebased 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.

CON VERTI BLE PROGRAM 2010 AND WARRANT PROGRAM 2010

The Annual General Meeting resolved that JM AB would raise a debenture loan with a maximum nominal value of SEK 120,000,000 by issuing a maximum of 530,000 convertible debentures, aimed at all employees in Sweden and issue a maximum of 95,000 warrants aimed at all employees outside Sweden.

The purpose of the 2010 Convertible Program and 2010 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 32 million through the issue of about 227,000 convertible debentures and the number of warrants issued is approximately 5,000. 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. The convertible debenture loan was settled against cash in July 2010.

The subscribed convertible bonds and warrants may be converted to, or entitle the holder to subscribe for, one ordinary share at a price of SEK 139. Conversion of convertible bonds or subscription of ordinary shares with support of warrants may occur during the period from June 1, 2012 through May 22, 2014, with the exclusion of the period January 1 through the record date for dividends each year, or if the Annual General Meeting should not resolve on a dividend during a year, the day that falls three Banking Days after the Annual General Meeting.

Through conversion of convertibles and subscription for warrants, JM's share capital could increase by a maximum of SEK 232,715, through the issue of a maximum of 232,715 ordinary shares, each with a quota value of SEK 1. This corresponds with dilution of about 0.3 percent of shares and votes in the Company.

The convertible debenture loan falls due for payment on June 16, 2014, insofar as conversion has not already been undertaken.

MANAGE MENT 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 milion
• • 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 Executive Management.

JM's operational organization can be seen in the above diagram.

executive MANAGE MENT

JM's business is operationally divided into six business units. External financial reporting takes place in five business segments. Each business unit manager reports directly to the President. Executive Management comprises the President, all heads of business units and heads of corporate staff units, a total of nine 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.

GOVERNAN CE 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.

Stockholm, February 22, 2011 Board of Directors

AUDITOR 'S REPORT ON THE CORPORATE GO VERNAN CE STATE MENT

To the Annual General Meeting of shareholders in JM AB, Company reg. no. 556045-2103.

It is the Board of Directors who is responsible for the corporate governance report for the year 2010 on pages 85–91 and that it has been prepared in accordance with the Annual Accounts Act.

As a basis for our opinion that the corporate governance report has been prepared and is consistent with the annual accounts and the consolidated accounts, we have read the corporate governance report and assessed its statutory content based on our knowledge of the Company.

In our opinion, the corporate governance report has been prepared and its statutory content is consistent with the annual accounts and the consolidated accounts.

Stockholm February 22, 2011 Ernst & Young AB

Ingemar Rindstig Jonas Svensson Authorized Public Accountant Authorized Public Accountant

92 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, Kia Orback Pettersson, Peter Skogert, Stefan Brodén, Åsa Söderström Jerring.

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: 63

Education: MSc Econ. 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 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, Chairperson of the Audit Committee. Appointed to the Board: 2002

Shares in JM: 2,070

Age: 65

Education: MA, Stockholm University. Work experience: 14 years at KPMG as an authorized public accountant and corporate finance consultant, 11 years as VP and President of three different service companies: MGruppen, Tönnerviksgruppen and Sifo Group; 6 years as President and strategic consultant at SMG and 5 years as President and CEO of Univero Group. Other significant appointments: Board member of Upplands Motor AB, Öresundsbrokonsortiet, Knightec AB, Mercuri International AB and LRF Konsult AB.

Independent: The Director is considered to be independent.

Anders Narvinger

Board member, member of the Audit Committee. Appointed to the Board: 2009 Shares in JM: 5,000 Age: 62 Education: MSc Eng. Lund Institute of Technology; MSc Econ. Uppsala University. Work experience: President of Teknikföretagen. Active within the ABB Group, including as President and CEO of ABB Sverige. Other significant appointments: Chairman of the Board of Telia Sonera AB, Alfa Laval AB, Trelleborg AB, Coor Service Management AB. Board member of Pernod Ricard SA.

Independent: The Director is considered to be independent.

Johan Skoglund

President and CEO, Board member. Appointed to the Board: 2003 Shares in JM: 26,063 Convertibles: SEK 4,871,058 Material shareholdings or part ownerships in companies with which the Company has material business relationships: 0

Age: 48 Education: MSc Eng. Royal Institute of Technology, Stockholm; MSc Program

Stockholm School of Economics. Work experience: 24 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 Castellum AB, 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, member of the Investment Committee and Compensation Committee. Appointed to the Board: 2007 Shares in JM: 5,000

Age: 54

Education: MSc Econ. 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 anläggningsbranschen (FIA). Independent: The Director is considered to be independent.

Torbjörn Torell

Board member, member of the Investment Committee. Appointed to the Board: 2004 Shares in JM: 5,000

Age: 55

Education: MSc Eng. 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, President 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 of Carl Bro AS.

Other significant appointments: President and CEO of Bravida AB since the autumn of 2004.

Independent: The Director is considered to be independent.

Kia Orback Pettersson

Board member, member of the Audit Committee. Appointed to the Board: 2010 Shares in JM: 740

Age: 51

Education: MSc Econ. Work experience: 20 years experience from leading positions within retail, real estate and media business; President

of Sturegallerian and VP of Guldfynd/ Hallbergs.

Other significant appointments: Partner in Konceptverkstan. Chairperson of the Board for NAI Svefa AB and Ponderus Invest AB. Board member of Forsen Projekt AB, Hemtex AB, Jernhusen AB, Kungsleden AB, Springtime AB and Tengbomgruppen AB. Independent: The Director is considered to be independent.

EMPLO YEE 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 172,264

Stefan Brodén

Born: 1952. Network engineer. Deputy member of the Board since 2007. Shares in JM: 537 Convertibles: SEK 39,608

SE CRETAR Y OF THE BOARD

Urban Lilja

Born 1952, Chief Legal Advisor, JM AB Secretary to the Board of Directors since 1996. Shares in JM: 13,803 Convertibles: SEK 3,523, 364

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, 2011.

Top row from left to right: Johan Skoglund, Claes Magnus Åkesson, Helena Söderberg, Sten Hamberg, Fredric Kastevik, Bottom row from left to right: Zdravko Markovski, Sören Bergström, Urban Lilja, Lennart Henriz.

EXECUTI VE MANAGE MENT *

Johan Skoglund

President and CEO

JM employee since: 1986 Member of Executive Management: 2000 Shares in JM: 26,063

Convertibles: SEK 4,871,058

Age: 48 years. MSc Eng. Royal Institute of Technology, Stockholm 1986, and MSc Program Stockholm School of Economics, 1998.

Former positions at JM: 16 years 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 Castellum AB, Sveriges Byggsindustrier and Mentor Sverige.

Sören Bergström

Business unit manager JM Residential Sweden and Director of Purchasing JM employee since: 1988 Member of Executive Management: 2001

Shares in JM: 863 Convertibles: SEK 3,040,224

Age: 54 years. MSc Eng. Royal Institute of Technology. MSc 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 2002–2006. Head of JM Residential Sweden business unit 2007–. 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: 20,019 Convertibles: SEK 3,305,212 Age: 60 years. LL.B. Uppsala University

1976.

Former positions at JM: In-house counsel, President of AB Borätt and Seniorgården AB. Business unit manager Business Development/Properties. Business unit manager JM Residential Sweden 2005–2006 and JM Business Development 2007–2008. Business unit manager JM Norway as well as JM Denmark, Finland and Belgium Nov 2009–.

Chairman of the Board of JM Norge AS, JM Suomi Oy, JM Danmark A/S and Bofrämjandet.

Lennart Henriz

Director Operations Development (Technology, Quality and Environment, IT) JM employee since: 1978 Member of Executive Management: 1999

Shares in JM: 10,471 Convertibles: SEK 3,523,364

Age: 57 years. MSc Eng. Royal Institute of

Technology 1978. Former positions at JM: Head of development, IT manager, VP and regional manager AB Projektgaranti, Quality and Environment

Manager. Director of Operations Development 2000–.

Fredric Kastevik

Business unit manager JM Production and President JM Entreprenad AB JM employee since: 1997 Member of Executive Management: 2010

Shares in JM: 9,988, including 6,000 in endowment insurance Convertibles: 1,693,506 kr

Age: 37 years. MSc Eng. Royal Institute

of Technology 1997. MSc Program IFL/ Stockholm School of Economics 2007.

Former positions at JM: Regional manager JM Entreprenad. Business unit manager JM Production 2010–.

Board member of JM Entreprenad AB, Stockholms Byggmästarförening and Sveriges Byggindustrier Region Öst.

Urban Lilja

Chief Legal Advisor and Secretary to the Board JM employee since: 1996 Member of Executive Management: 1996 Shares in JM: 13,803 Convertibles: SEK 3,523,364

Age: 58 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 Property Development, as well as head of Marketing Communications and Business Development JM employee since: 1987 Member of Executive Management: 2002

Shares in JM: 9,883 Convertibles: SEK 2,282,196

Age: 46 years. MSc Eng. Royal Institute of Technology 1987.

Former positions at JM: Project manager, regional manager and Business unit manager JM Residential. Business unit manager JM Residential Stockhom 2003–.

Chairman of the Board of AB Borätt and Seniorgården AB.

Helena Söderberg

Director Human Resources JM employee since: 2010 Member of Executive Management: 2010

Shares in JM: 0 Convertibles: SEK 0

Age: 43 years. Degree in Human Resources, Uppsala University 1991. Nordic HR Director Alstom Transport 2007–2010, 16 years in various HR positions within the Skanska Group.

Claes Magnus Åkesson

Chief Financial Officer JM employee since: 1998 Member of Executive Management: 1998 Shares in JM: 50,666, including 48,000 in

endowment insurance Convertibles: SEK 3,523,364

Age: 51 years. MSc Econ. Stockholm School of Economics, 1984. Advanced Management Programme, INSEAD, France.

Ericsson Group 1987–1998: senior controller Asia, head of finance and treasury Malaysia and regional controller Asia. Board member of Concentric AB,

JM Norge AS and JM Construction S.A.

OT HER SENIOR EXECUTI VES

Annika Berg, Stockholm North Region Jonas Håkansson, South Region Per Johansson, Marketing Residential Stockholm Mikael Matts, East Region Per-Anders Olsson, Malmö Region Martin Svahn, West Region Pär Vennerström, Stockholm South Region Anders Wimmerstedt, Production Residential Stockholm Mikael Åslund, Stockholm City Region

Lars-Olof Höglund, JM Property Development Birgitta Seeman, Seniorgården AB and AB Borätt

Jonny Änges, JM Stombyggnad AB and JM Inredning i Stockholm AB

Magnus Berg, JM Norge AS Christopher Lee, JM Construction S.A., Belgium Lars Svärd, JM Suomi OY, Finland Anders Wahrer, JM Danmark A/S, Denmark.

* Members of the Executive Management part of the year: Helene Hasselskog, Director Human Resources and Sofia Ljungdahl, Business unit manager JM Property Development. Shareholdings as of February 28, 2011.

GOOD SHARE PRICE TREND

SHARE CAPITAL

The JM share is listed on 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.

SHARE HOLDERS' OBJE CTI VE

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 Stockholm Household Durables Index of the NASDAQ OMX Nordic since 2009. In 2010 JM's share price rose 28 percent, compared with an increase of 15 percent for the SX252010, and an increase of 15 percent for the SX201030, another relevant comparative index for JM. The general index on the OMX Stockholm Stock Exchange, OMX Stockholm_PI, rose 23 percent in 2010. The highest listed price for the JM Share during the year was SEK 160 on December 29 and the lowest was SEK 98.50 on May 20. Dividend yield (proposed dividend in relation to the market price at year-end) was 2.9 percent (2.0). Total return in 2010 was 30 percent (186).

Total return, %	2010	Average per year 2006–2010
JM	30	47
OMX Stockholm Stock Exchange	26	13

Total return JM, 2006–2010	%	Index
2010	30	242
2009	186	186
2008	– 60	65
2007	– 16	163
2006	94	194
Jan. 1, 2006	-	100
Average, 5 years	47

TRADING AND MARKET CAPITALIZATION

JM shares were traded for a value of SEK 13.5bn (11.3) in 2010. Average daily trading was about SEK 53m (45). The turnover rate (the liquidity of the share) was 129 percent (198) during the year compared with an average for the entire stock exchange of 96 percent (119). The Company's market capitalization amounted to SEK 13.1bn (10.2) at year-end.

OWNERS HIP STRUCTURE

The number of shareholders as of December 31, 2010 was 12,968 (12,890). The ten largest Swedish shareholders accounted for 54.1 percent (45.2) of capital and foreign shareholders for 18.9 percent (24.5).

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 2010 amounts to SEK 4.50 (2.50) per share.

Transfer to shareholders, SEKm	Dividend	Redemption	Total
2006	247	1,002	1,249
2007	415	1,013	1,428
2008	489	992	1,481
2009	-	-	-
2010	208	-	208
Total	1,359	3,007	4,366

Shareholders as of December 31, 2010	Percent of shares
AMF Försäkring och Fonder	11.1
Swedbank Robur funds	9.5
S-E-Banken–fonder and Gamla Livförsäkringsbolaget SEB Trygg Liv	6.5
AFA Försäkringar	5.8
Nordea–funds	5.5
Heirloom Asset Management AB	4.5
Lannebo funds	3.2
Fjärde AP-fonden	2.9
Enter Fonder	2.7
Folksam–KPA–Förenade Liv	2.4
Andra AP-fonden	2.0
Livförsäkrings AB Skandia and Fonder	1.7
Handelsbanken–funds	1.6
Länsförsäkringar–funds	1.5
Stefan Persson Placering AB	0.6
Foreign shareholders	18.9
Other shareholders	19.6
Total	100.0

Number of shareholders as of Dec. 31, 2010: 12,968

Number of shares as of Dec. 31, 2010 amounts to 83,401,883

SHARE DATA 1)
SEK per share	2010	2009	2008	2007	2006
Share price as of Dec. 31	157.5	123	43	132.50	166
Highest/lowest price paid during the year	160/98.5	129.50/33.40	152/26.30	264/107.25	168.50/87.50
Dividend yield as of Dec. 31 (%)	2,9	2.0	0	4.2	2.7
Market capitalization as of Dec. 31 (SEKm)	13,110	10,236	3,578	11,777	15,320
Earnings per share, basic and diluted	7.10	4.40	9.50	18.30	16.40
Development properties
Market value	96	83	88	91	77
Carrying amount	65	60	68	59	47
Project properties
Market value	8	7	8	12	12
Carrying amount	8	7	7	9	9
Shareholders' equity (reported)	47	44	39	44	39
Dividend	4.50 2)	2.50	0	5.50	4.50
Dividend in % of earnings per share	63	57	0	30	27
P/E ratio as of Dec. 31	22	28	5	7	10
Number of shares as of Dec. 31	83,237,058 3)	83,216,883 4)	83,216,883 4)	88,879,308 5)	92,289,764
Average number of shares, basic	83,229,492	83,216,883	85,968,011	91,076,274	95,453,698
Average number of shares, diluted	84,671,817	84,376,081	85,991,380	91,090,084	95,453,698

1) Financial year 2008 and earlier are not restated according to IFRIC 15.

2) Proposed by the Board.

3) 164,825 repurchased shares not included.

4) 185,000 repurchased shares not included.

5) 35,000 repurchased shares not included.

OWNERS HIP STRUCTURE AS OF DEC. 31, 2010

Size of holding	No. of shareholders	% of all shareholders	Total number of shares owned	% of share capital
1–500	8,688	67.0	1,627,537	2.0
501–1,000	1,998	15.4	1,676,721	2.0
1,001–5,000	1,666	12.8	3,850,057	4.6
5,001–20,000	332	2.6	3,339,954	4.0
20,001–100,000	157	1.2	6,957,368	8.3
100,001–	127	1.0	65,950,246	79.1
Total	12,968	100.0	83,401,883	100.0

CHANGES IN SHARE CAPITAL 2006–2010

Year	Share split	Redemption of shares, SEKm	Number of shares	Par value/ share	Share capital, SEKm
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
2010			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 Thursday, April 28, 2011, 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 Wednesday, April 20, 2011, and must have informed the Company of their intention to participate by 4 p.m. on Wednesday, April 20, 2011, using one of the following channels:

JM AB's website:	www.jm.se (only for private individuals)
E-mail:	monica.charron@jm.se
Mail:	JM AB, SE-169 82 Stockholm, Sweden
Telephone:	+46 (0)8 782 87 00
Fax:	+46 (0)8 782 86 24

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 Wednesday, April 20, 2011. Admission cards to the Annual General Meeting will be sent out.

DIVIDEND

The Board of Directors proposes that a dividend of SEK 4.50 per share be paid to shareholders. The proposed record date for the dividend is Tuesday, May 3, 2011. If the Annual General Meeting resolves to adopt the recommendation the dividend will be sent by Euroclear Sweden AB on May 6, 2011.

FINANCIAL CALENDAR

April 28, 2011	Interim report January–March 2011
	Annual General Meeting 2011
August 24, 2011	Interim report January–June 2011
October 28, 2011	Interim report January–September 2011
February 10, 2012 Y	ear-end report 2011
April 26, 2012	Interim report January–March 2012
	Annual General Meeting 2012

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.

		DEVELOP	MENT PROPERTIES	— RESIDENTIAL
	sweden
Country	Property/project Municipality Location	Number of residential units in housing projects not yet started approx.	Development period	Current rentable space Dec 2010 m2	Rental income 2010 SEKm	Form of tenure	Planning process Planning phase Production
Sweden	Liljeholmskajen	1,400	2001–2016		0.4		Detailed plan – 740 units
	Stockholm					Tenant-owners
	Årstadal/Liljeholmen					association	Production start 2001
Sweden	Liljeholmen Stockholm	280	2013–2016	2,800	4.0	Tenant-owners	Detailed plan 2013
Sweden	Liljeholmen/Gröndal Sandhamn	280	2011–2014			association	Production start 2013 Detailed plan 2009
	Farsta Stockholm					Tenant-owners association	Production start 2011
Sweden	Telefonplan	210	2010–2013				Detailed plan 2010
	Stockholm					Tenant-owners
	Telefonplan					association	Production start 2011
Sweden	Järvastaden	670	2007–2020			Tenant-owners	Detailed plan
	Solna/Sundbyberg					association
	Norra Solna and Sundbyberg					Freehold apartments	Production start 2007
Sweden	Dalénum	700	2007–2018				Detailed plan 2010
	Lidingö					Tenant-owners
	Close to water					association	Production start 2010
Sweden	Kvarnholmen	1,050	2009–2020	approx. 20,000	12.8		Detailed plan – 200 units
	Nacka					Tenant-owners
Sweden	Close to water Charlottendal/Farstadal	440	2002–2017			association Tenant-owners	Production start 2010 Detailed plan – 60 units
	Värmdö					association
	Gustavsberg					Freehold apartments	Production start 2003
Sweden	Östermalm Västerås	275	2005–2014			Tenant-owners	Detailed plan
	City					association	Production start 2005
Sweden	Industristaden	470	2002–2016	8,300	2.9		Detailed plan 2011
	Uppsala					Tenant-owners
	Kungsängen					association	Production start 2003
Sweden	Librobäck	300	2011–2017	7,200	4.1		Detailed plan 2011
	Uppsala					Tenant-owners
	Yttre Luthagen					association	Production start 2012
Sweden	Kviberg	240	2003–2015				Detailed plan 2009
	Gothenburg					Tenant-owners
	By the river Säveån					association	Production start 2010
Sweden	Västra Eriksberg	220	2009–2015				Detailed plan
	Gothenburg					Tenant-owners
	Norra Älvstranden					association	Production start 2009
Sweden	Juvel Kvarnen	290	2006–2015				Detailed plan 2011
	Gothenburg					Tenant-owners
Sweden	Norra Älvstranden Dockan	215	2003–2016			association	Production start 2006 Detailed plan – 110 units
	Malmö					Tenant-owners
	Västra Hamnen					association	Production start 2003

sweden (continued)

Country	Property/project Municipality Location	Number of residential units in housing projects not yet started approx.	Development period	Current rentable space Dec 2010 m2	Rental income 2010 SEKm	Form of tenure	Planning process Planning phase Production
Sweden	Lomma	580	2003–2017			Tenant-owners	Detailed plan
	Lomma					association
	Lomma Hamn					Freehold apartments	Production start 2004
Sweden	Kugghjulet	475	2013–2020	17,500	9.0		Detailed plan 2014
	Lund					Tenant-owners
	Västra Lund					association	Production start 2014
Sweden	Raffinaderiet	345	2009–2015	4,400	2.7		Detailed plan 2010
	Lund					Tenant-owners
	By rail station					association	Production start 2011
Total		8,440
Other building rights, not specified		12,260
Total building rights,Sweden		20,700

				international
Country	Property/project Municipality Location	Number of residential units in housing projects not yet started approx.	Development period	Current rentable space Dec 2010 m2	Rental income 2010 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 harbour					Freehold apartments	Production start 2011
Total		1,305
Other building rights, not specified		5,495
Total building rights, international		6,800

project properties

Rental space, m2 (including garage)	Residential properties (leasehold)	Properties under development	Fully devel oped project properties
Greater Stockholm	-	57,621	427
Rest of Sweden	-	-	4,368
International	-	-	2,868
Total	-	57,621	7,663

RENTABLE SPACE, BY CATEGORY

PROPERTIES UNDER DEVELOP MENT

No.	Property	Age	Total rentable space	Rentable space, by category		Rental income 2010	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	Kallhäll 1:22	1907	17,123	0	0	9.7	32	Development of offices
	Järfälla			2,794	13,599		0	and industry
	Fabriksvägen			0	730		0	Haglöfs, Friskis & Svettis
	Light industry						68	and others
2	Dalénum	1912–1960	40,498	0	0	39.5	57.5	Development of offices
	Lidingö	2009		21,873	18,625		0	AGA
	Södra Kungsvägen			0	0		0	Bring
	Office, etc.						42.5	Recco and others

FULL Y DEVELOPED comm ercial PROPERTIES

No.	Property	Age	Tax year 2010	Total rentable space	Rentable space, by category		Income 2010	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	%
3	Yxlö 3:51	1984	1.5	427	0	0	0.5	0	Internal used by JM
	Nynäshamn	2009			0	427		0
	Ådudden				0	0		0
	Conference facility							100
4	Beitostølen	1990	2.6	90	0	90	0.0	0	Internal used by JM
	Beitostølen, Norway				0	0		0
	Øystre Slidre				0	0		100
	Cabins/lodge							0
5	Norway, Grefsen (50%)	1978	27.6	2,558	0	0	1.5	100	Steinar Hansen AS
	Bærum, Norway	1986			2,003	555		0	Danmon Norge AS
	Bærumsveien 473				0	0		0	Oslo Hundeskole
	Office							0
6	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
7	Hotell Societeten	1700	1.7	220	0	0	0.3	0	Nord-Jarlsbergsmuseene
	Holmestrand, Norway	1999			0	220		0
					0	0		0
	Museum							100

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

Linköping Brigadgatan 24, SE-587 58 Linköping Tel. +46 13 37 14 00, fax +46 13 37 14 09

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

Gothenburg (regional office) Gårdatorget 2, SE-412 50 Gothenburg 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 Malmö Region and South Region Malmö (regional office) Box 327, SE-201 23 Malmö Visiting address: Jörgen Kocksgatan 9

Tel. +46 40 16 56 00, fax +46 40 16 56 01 Halmstad

Brogatan 1, SE-302 43 Halmstad Tel. +46 35 299 42 50, fax +46 35 10 67 45

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 Norge AS Postboks 33 N-1306 Bærum Postterminal Visiting address: Bærumsveien 473, Rud Tel. +47 67 17 60 00, fax +47 67 13 61 60 www.jm.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 and Lindermyr Produktion Text:  JM Graphic design: Holy Diver Layout and repro: Anette Andersson Photos and illustrations: Torbjörn Bergkvist, Cadwalk, Carl Dahlstedt, Dark Arkitekter A/S, Dynagraph, Elitfönster, ETTELVA Arkitekter/Pixprovider, Sune Fridell, Richard Hammarskiöld, HMXW Arkitekter, Tomas Jonson, Mathias Landefjord, kvarnholmen.com/mediabank, Perry Nordeng, Per Magnus Persson, Daniel Roos, Gro Storteig, Lars Strandberg, Älvstranden Utveckling AB and JM Printing: Åtta.45 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