JM — Interim / Quarterly Report 2016

Apr 21, 2016

Interim report 1/ 2016

JM GROUP JANUARY–MARCH 2016

CONTINUED STRONG SALES AND HIGH LEVEL OF HOUSING STARTS

• According to segment reporting, revenue increased to SEK 3,757m (3,417) and operating profit increased to SEK 445m (372). The operating margin increased to 11.8 percent (10.9)
• Restated according to IFRIC 15, revenue increased to SEK 3,470m (3,300) and the operating profit increased to SEK 403m (361). This restatement is attributable to JM International and had a negative effect on earnings of SEK –42m (–11)
• Profit before tax increased to SEK 387m (342). Profit after tax increased to SEK 299m (261)
• Return on equity for the past twelve months amounted to 23.8 percent (27.4). Earnings per share for the first quarter increased to SEK 4.10 (3.50)
• Consolidated cash flow including net investment in properties was SEK 601m (–273)
• Number of residential units sold increased to 927 (843) and housing starts increased to 856 (748)

SEK m 2014	January–December January–March 2016 2013	2015	April–March 2015/2016 2014	October–December Full-year 2013 2015
Revenue (segment reporting)	3,757	3,417	14,787	14,447
Operating profit (segment reporting)	445	372	1,663	1,590
Operating margin (segment reporting), %	11.8	10.9	11.2	11.0
Revenue 1)	3,470	3,300	14,109	13,939
Operating profit 1)	403	361	1,541	1,499
Profit before tax 1)	387	342	1,472	1,427
Operating margin, %1)	11.6	10.9	10.9	10.8
Cash flow from operating activities	601	–273	644	–230
Return on equity, % 1)			23.8	23.7
Equity/assets ratio, % 1)	40	40		38
Earnings per share, SEK 1)	4.10	3.50	15.20	14.50
Number of residential units sold	927	843	3,854	3,770
Number of housing starts	856	748	3,839	3,731
Number of residential units in current production	7,550	6,635		7,212

1) According to IFRIC 15.

The Group applies IFRIC 15 Agreements for the Construction of Real Estate to its income statement and balance sheet. This means that revenue and profit and loss for JM's operations outside of Sweden, JM International, are reported according to the completed contract method. Segment reporting and project management are reported according to IAS 11, percentage of completion method. The description of operations is based on segment reporting. The Group applies IFRIC 15 Agreements for the Construction of Real Estate to its income statement and balance sheet. This means that revenue and profit and loss for JM's operations outside of Sweden, JM International, are reported according to the completed contract method. Segment reporting and project management are reported according to IAS 11, percentage of completion method. The description of operations is based on segment reporting.

GROUP

"Demand for JM's residential units has continued to be stable in JM's main markets during the first quarter. Strong sales support a continued high level of housing starts.

Revenue for the quarter confirms the stable development in our housing operations in Stockholm. Housing operations in the rest of Sweden is demonstrating strong improvement in terms of revenue and profit due to strong demand and price increases for our residential units. The concentration of our foreign operations to Norway and Finland also strengthens the operating margin.

Structurally, conditions for our business are favorable, including large population increases in the markets where we are active. We are dynamically positioned with financial strength and a very good project portfolio that continues to be improved and renewed at the same time as our strong balance sheet offers us freedom of action."

Johan Skoglund, President and CEO

MARKET, SALES AND HOUSING STARTS

Demand for newly built homes in Sweden and Norway has been stable during the first quarter. Interest in JM's projects is strong. Population growth in our main markets, coupled with continued low interest rates, supports demand for housing.

The number of residential units sold in the form of signed contracts was 927 (843) 1). The percentage of sold or reserved homes in relation to current production amounts to 86 percent (85), with an interval of 60-65 percent considered normal. JM Residential Stockholm sold 397 residential units (375), JM Residential Sweden sold 319 (267), JM International sold 211 (201) and JM Property Development sold 0 (0).

The number of housing starts increased to 856 (748)2). JM Residential Stockholm started production on 372 residential units (351), JM Residential Sweden on 304 (265), JM International on 180 (132) and JM Property Development on 0 (0).

Planning process continue to be an important criterion for the rate of housing starts.

The number of residential units in current production increased to 7,550 (6,635), of which 338 are rental units and residential care units (430).

1) Of which 0 rental units and residential care units (0). 2) Of which 0 rental units and residential care units (0).

		January–March	April–March	Full-year
Operating profit (SEK m)	2016	2015	2015/2016	2015
JM Residential Stockholm	294	263	1,109	1,078
JM Residential Sweden	105	60	353	308
JM International	43	33	176	166
JM Property Development	6	15	29	38
JM Construction	10	16	39	45
Group-wide expenses	–13	–15	–43	–45
Total (segment reporting)	445	372	1,663	1,590
Restatement JM International 1)	–42	–11	–122	–91
Total	403	361	1,541	1,499
Of which property sales	1	24	33	56

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

1) According to segment reporting

REVENUE, OPERATING PROFIT AND OPERATING MARGIN

Consolidated revenue according to segment reporting for the first quarter increased to SEK 3,757m (3,417). Revenue restated according to IFRIC 15 increased to SEK 3,470m (3,300).

Operating profit according to segment reporting increased to SEK 445m (372) and the operating margin increased to 11.8 percent (10.9). Operating profit restated according to IFRIC 15 increased to SEK 403m (361). This restatement is attributable to JM International and had a negative effect on earnings of SEK –42m (–11).

During the first quarter properties were sold for SEK 7m (85) with gains of SEK 1m (24).

Rental income from JM's project properties was SEK 5m (5). Net rental income was SEK 1m (1).

		January–March	April–March	Full-year
Operating margin, %	2016	2015	2015/2016	2015
JM Residential Stockholm	17.3	17.0	17.2	17.2
JM Residential Sweden	10.4	8.1	9.9	9.4
JM International	5.6	5.2	5.5	5.4
JM Construction	2.8	2.9	2.1	2.2

Residential units in current production	3/31/2016	3/31/2015	12/31/2015
Number of residential units in current production 1) 2)	7,550	6,635	7,212
Percentage of sold residential units in current production, % 3)	67	61	64
Percentage of reserved residential units in current production, %	19	24	22
Percentage of sold and reserved residential units in current production, %	86	85	86
1) Including rental units and residential care units in current production in JM Property Development – not included in the percentage of sold and reserved residential units in current production.	338	430	338
Includes residential units in projects where costs incurred are only reported as project properties under construction.	284	284	284

2) Beginning with production startup through final occupancy according to plan.

3) Percentage of sold residential units expressed as binding contract with the end customer.

Completed production, unsold units	3/31/2016	3/31/2015	12/31/2015
Completed production, number of unsold units 1)	75	113	98
- Of which in the balance sheet reported as "Participations in tenant-owner associations, etc."	68	81	71

1) After final occupancy according to plan.

RESIDENTIAL BUILDING RIGHTS

The number of available building rights amounted to 30,800 (29,700), of which 17,900 (17,600) are recognized in the balance sheet. Capital tied up in building rights (development properties on the balance sheet) for residential units amounted to SEK 6,700m (6,758) at the end of the first quarter.

JM acquired development properties for residential units during the first quarter for SEK 250m (504), of which SEK 98m relates to JM Residential Stockholm, SEK 99m to JM Residential Sweden and SEK 53m to JM International.

Percentage sold/reserved, Group (%) Normal level sold/reserved (60-65%) 1) Including rental units and residential care units in JM Property Development – not included in percentage of sold/reserved

FINANCIAL ITEMS

Net financial items improved by SEK 3m compared to the previous year, which is attributable to lower interest-bearing loans and lower average interest rates.

The total interest-bearing loan stock was SEK 1,923m (2,183), of which the pensions liability comprised SEK 1,140m (1,117). At the end of the first quarter, the average interest rate for the total interest-bearing loan stock including pension liabilities was 2.6 percent (2.9). The average term for fixed-rate loans excluding the pension liability was 0.5 years (0.2).

Consolidated available liquidity was SEK 3,982m (4,877). Aside from cash and cash equivalents of SEK 1,182m (2,077), this includes unutilized overdraft facilities and credit lines totaling SEK 2,800m (2,800), where credit agreements for SEK 2,400m had an average maturity of 2.0 years (1.6).

Interest-bearing net liabilities at the end of the first quarter totaled SEK 741m (106). Non-interest-bearing liabilities for completed property acquisitions amounted to SEK 493m (548). Of these liabilities SEK 343m (382) were short-term.

The valuation of financial assets and liabilities shows that there is no material difference between the carrying amount and the fair value.

		January–March	April–March	Full-year
SEK m	2016	2015	2015/2016	2015
Financial income 1)	1	1	11	11
Financial expenses 2)	–17	–20	–80	–83
Financial income and expenses	–16	–19	–69	–72
1) Of which revaluation and currency hedging	-	0	2	2
2) Of which revaluation and currency hedging	-	0	–2	–2

	January–March		April–March	Full-year
SEK m	2016	2015	2015/2016	2015
Interest-bearing net liabilities(+)/ receivables(-) at beginning of the period	1,198	–337	106	–337
Change in interest-bearing net liabilities/receivables	–457	443	635	1,535
Interest-bearing net liabilities(+)/ receivables(-) at end of the period	741	106	741	1,198

CASH FLOW

Cash flow from operating activities was SEK 601m (–273) during the first quarter. Net investments in development properties resulted in a cash flow of SEK 319m (–727). Holdings of repurchased residential units resulted in a positive cash flow of SEK 10m (–34). Consolidated cash flow from project properties (sales minus investment) during the first quarter was SEK –54m (–24).

RISKS AND UNCERTAINTIES

JM's risk and risk management policies are presented in the 2015 annual report on pages 29-32. No significant changes have occurred to change these reported risks.

BUY-BACK AND HOLDINGS OF OWN SHARES

During the first quarter of 2016, 623,100 shares were bought back for a total of SEK 125m. Holdings of own shares subsequently total 2,202,624. After the 2015 Annual General Meeting, shares were bought back for SEK 500m.

The number of outstanding shares, excluding holdings of own shares, at March 31, 2016, totals 72,981,780.

The Board has proposed that the 2016 Annual General Meeting resolve to decrease the share capital by SEK 2,202,624 through the elimination of 2,202,624 shares.

PERSONNEL

The number of employees at the end of the first quarter was 2,308 (2,228). The number of wage-earners was 1,007 (962) and the number of salaried employees was 1,301 (1,266). Current staffing is considered well balanced for the current project volume and some adjustments are made on a regular basis. Demand on the labor market is strong for qualified project development skills.

BUSINESS SEGMENT

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.

	January–March		April–March	Full-year
SEK m	2016	2015	2015/2016	2015
Revenue	1,704	1,545	6,432	6,273
Operating profit 1)	294	263	1,109	1,078
Operating margin, %	17.3	17.0	17.2	17.2
Average operating capital			4,229	4,134
Return on operating capital, %			26.2	26.1
Operating cash flow	460	–413	529	–344
Carrying amount, development properties	4,310	4,012		4,517
Number of available building rights	12,300	11,900		12,400
Number of residential units sold	397	375	1,622	1,600
Number of housing starts	372	351	1,688	1,667
Number of residential units in current production	3,801	3,332		3,627
Number of employees	843	808		854
1) Of which property sales	-	-	0	0

Average prices on the existing home market did not change in downtown Stockholm and increased somewhat in other parts of the business segment. The supply of residential units continues to be very low, primarily due to rapid turnover on the market. The supply of new homes continues to be low in relation to long-term demand in the Stockholm area.

Competition for well-situated land for residential units continues to be tough, and the prices for building rights continue to be at a level that requires JM to be very selective when acquiring land.

Interest in JM's projects is very strong. The customers' tendency to sign a contract early in the process is above a normal level.

Revenue in the business segment increased to SEK 1,704m (1,545), which confirms the stable development for the operations. Operating profit increased to SEK 294m (263). The operating margin was 17.3 percent (17.0).

Cash flow during the first quarter is in balance taking into consideration the decrease in development properties.

In total, production was started in the first quarter on 372 residential units in apartment buildings in Lidingö and Stockholm.

During the first quarter JM purchased building rights in Stockholm corresponding to 60 residential units.

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.

	January–March		April–March	Full-year
SEK m	2016	2015	2015/2016	2015
Revenue	1,007	737	3,548	3,278
Operating profit 1)	105	60	353	308
Operating margin, %	10.4	8.1	9.9	9.4
Average operating capital			1,249	1,289
Return on operating capital, %			28.3	23.9
Operating cash flow	174	79	628	533
Carrying amount, development properties	1,189	1,101		1,269
Number of available building rights	9,600	9,300		9,900
Number of residential units sold	319	267	1,325	1,273
Number of housing starts	304	265	1,267	1,228
Number of residential units in current production	1,962	1,758		1,944
Number of employees	544	494		539
1) Of which property sales	0	0	-	0

Average prices on the existing home market continued to increase in Malmö. Prices in the other markets in the business segment did not change during the first quarter. The supply of residential units continues to be low, primarily due to an increasing turnover rate on the market.

Competition for land for residential units is very tough in Gothenburg and Uppsala.

Interest in JM's projects is strong. The customers' tendency to sign a contract early in the process is above a normal level.

Business segment revenue increased to SEK 1,007m (737) and operating profit increased to SEK 105m (60). The operating margin increased to 10.4 percent (8.1). The profit and the margin improved as a result of strong demand and an increase in prices.

Cash flow during the first quarter is in balance taking into consideration the decrease in development properties.

JM started production during the first quarter on 283 residential units in apartment buildings in Malmö, Gothenburg, Uppsala and Västerås and 21 single-family homes in Vallentuna.

During the first quarter, 275 building rights were acquired in Gothenburg, Linköping and Uppsala.

JM INTERNATIONAL

The JM International business segment develops residential projects primarily in Norway and Finland. Contracting operations are also conducted to a limited extent in Norway. Revenue recognition for the business segment is reported according to IAS 11, percentage of completion method.

	January–March		April–March	Full-year
SEK m	2016	2015	2015/2016	2015
Revenue	769	636	3,192	3,059
- of which JM Norway	677	562	2,779	2,664
Operating profit 1)	43	33	176	166
- of which JM Norway	42	34	189	181
Operating margin, %	5.6	5.2	5.5	5.4
- of which JM Norway	6.2	6.0	6.8	6.8
Average operating capital			2,093	2,145
Return on operating capital, %			8.4	7.7
Operating cash flow	31	–84	549	434
Carrying amount, development properties	1,191	1,645		1,202
Carrying amount, project properties	35	28		31
Number of available building rights	8,200	7,900		8,200
Number of residential units sold	211	201	853	843
Number of housing starts	180	132	830	782
Number of residential units in current production	1,449	1,115		1,303
Number of employees	391	388		395
1) Of which property sales	-	11	28	39

Business segment revenue increased to SEK 769m (636) and operating profit increased to SEK 43m (33). The operating margin increased to 5.6 percent (5.2).

Cash flow during the first quarter is in balance.

NORWAY

Demand for both newly built homes and homes on the existing home market is high, particularly in the Oslo region. The price level on the existing home market decreased slightly during the quarter with the exception of Oslo, which distinguished itself with a continued strong increase in prices. The banks' lending operations for mortgages is functioning normally, there is good access to capital and the lending rate is at a historically low level.

JM Norway's revenue increased to SEK 677m (562) and operating profit increased to SEK 42m (34). The operating margin was 6.2 percent (6.0).

During the first quarter 149 residential units (166) were sold and production began on 107 units (106).

Housing starts during the first quarter consist of 78 residential units in apartment buildings and 29 single-family homes. The number of residential units in current production amounts to 1,193 (845).

No acquisitions of building rights were made during the first quarter.

Available building rights correspond to 6,000 residential units (5,900).

FINLAND

The level of activity on the housing market in Helsinki continues to be low. Customers are still cautious and time to closing is long. The price level in the capital region remained unchanged during the quarter.

During the first quarter 57 residential units (23) were sold and production began on 73 units (26).

No acquisitions of building rights were made during the first quarter.

Available building rights correspond to 2,000 residential units (1,300).

OTHER INTERNATIONAL MARKETS

DENMARK

In 2015, JM completed the final phase of a single-family home project in Humlebäck and since then does not have any production in Denmark.

Available building rights correspond to approximately 30 residential units (500).

BELGIUM

During 2015, JM closed its office in Brussels and no longer has any staff there. Remaining operations are run by external resources.

During the first quarter 5 residential units (6) were sold and production began on 0 units (0).

The number of residential units in current production amounts to 62 (141). No acquisitions of building rights were made during the first quarter.

Available building rights correspond to 200 residential units (200).

JM PROPERTY DEVELOPMENT

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

	January–March		April–March
SEK m	2016	2015	2015/2016	2015
Revenue	28	47	187	206
Operating profit 1)	6	15	29	38
Average operating capital			361	326
Return on operating capital, %			8.0	11.7
Operating cash flow	69	–5	–132	–206
Carrying amount, development properties	35	25		35
Carrying amount, project properties	402	210		347
Number of available building rights 2)	700	600		600
Number of residential units sold 2)	-	-	54	54
Number of housing starts 2)	-	-	54	54
Number of residential units in current production 2)	338	430		338
Number of employees	30	28		29
1) Of which property sales	1	13	5	17

2) Refers to rental units and residential care units.

Business segment revenue decreased to SEK 28m (47), including contracting revenue of SEK 23m (42) and rental income of SEK 5m (5). Operating profit decreased to SEK 6m (15).

Net rental income for project properties amounted to SEK 0m (1). Profit from construction contracts was SEK 9m (6) and gains from property sales were SEK 1m (13).

Cash flow for the first quarter is boosted by received project funding.

Within the Dalénum area on Lidingö, the occupancy rate in the remaining commercial buildings that will not be demolished is 85 percent. Within the Bolinder area in Kallhäll, Järfälla, the occupancy rate is 85 percent in the buildings that will not be demolished.

Production has begun on a rental unit project in the Dalénum area, on JM's own balance sheet, consisting of 97 residential units, and completion is planned for 2016.

Production has begun on a rental unit project, Tjärtunnan, Stureby, in Stockholm, on JM's own balance sheet consisting of 187 rental units, and completion is planned for 2017.

Production is underway on the Vinfatet senior housing project in Sollentuna for an external orderer consisting of 54 residential units, and completion is planned for 2016.

JM CONSTRUCTION

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

SEK m	2016	January–March 2015	April–March 2015/2016	Full-year 2015
Revenue 1)	360	554	1,890	2,084
Operating profit	10	16	39	45
Operating margin, %	2.8	2.9	2.1	2.2
Operating cash flow	–6	108	–148	–34
Carrying amount, development properties	44	56		44
Number of employees	379	392		380
1) Of which internal	111	102	462	453

Demand in the contracting market in Stockholm is at a good level with customers displaying a good willingness to invest. Both the building and civil engineering markets are stable, although there is tough competition for the assignments.

Orders are good in the business segment, with a large number of projects in current production.

Business segment revenue decreased to SEK 360m (554) and operating profit decreased to SEK 10m (16). The operating margin was 2.8 percent (2.9).

The decreased revenue is attributable to the assignment for the new production of a biofuel cogeneration plant in Stockholm for Fortum Värme, which has now entered a closing phase.

Cash flow is limited by a delayed payment from an

external orderer that is under dispute.

The business segment received a number of assignments during the quarter, of which the largest is a new operational area at Arlanda Airport for Svedavia. Other new assignments also include the new production of an office building in Danderyd for Skandia Fastigheter AB and the new construction of a pedestrian and bicycle path along Route 859 (Märstastråket) in Upplands Väsby and Sigtuna Municipality for the Swedish Transport Administration.

The largest ongoing assignments are the renovation of quays in Norrtälje Harbor and development projects (Norrtälje Municipality) for future housing production, new production of apartment buildings in Gröndal (Aros Bostad), renovation of a school in Bromma (Skofastigheter i Stockholm AB) and development work for housing production in Hammarby Sjöstad (City of Stockholm).

CONDENSED CONSOLIDATED INCOME STATEMENT

		January–March April–March		Full-year
SEK m	2016	2015	2015/2016	2015
Revenue	3,470	3,300	14,109	13,939
Production and operating costs	–2,851	–2,753	–11,728	–11,630
Gross profit	619	547	2,381	2,309
Selling and administrative expenses	–217	–210	–873	–866
Gains/losses on the sale of property	1	24	33	56
Operating profit	403	361	1,541	1,499
Financial income and expenses	–16	–19	–69	–72
Profit before tax	387	342	1,472	1,427
Taxes	–88	–81	–349	–342
Profit for the period	299	261	1,123	1,085
Other comprehensive income
Items that will be reclassified as income
Translation differences from the translation of foreign
operations	22	5	–70	–87
Items that will not be reclassified as income
Restatement of defined-benefit pensions	0	–65	16	–49
Tax attributable to other comprehensive income	0	14	–3	11
Comprehensive income for the period	321	215	1,066	960
Net profit for the period is attributable to shareholders of the Parent
Company	299	261	1,123	1,085
Comprehensive income for the period is attributable to shareholders of the Parent Company	321	215	1,066	960
Earnings per share 1), basic, attributable to shareholders of
the Parent Company (SEK)	4.10	3.50	15.20	14.50
Earnings per share 1), diluted, attributable to shareholders of
the Parent Company (SEK)	4.10	3.50	15.10	14.50
Number of outstanding shares at end of period	72,981,780	75,047,313	72,981,780	73,594,000
Average number of shares, basic	73,365,666	75,335,379	74,109,209	74,601,637
Average number of shares, diluted	73,593,262	75,637,245	74,363,128	74,846,482
1) Net profit for the period.

CONDENSED CONSOLIDATED BALANCE SHEET

SEK m	3/31/2016	3/31/2015	12/31/2015
ASSETS
Non-current assets	212	228	209
Project properties	437	238	378
Development properties	6,769	6,839	7,067
Participations in tenant-owners associations, etc.	233	318	235
Current receivables 1)	3,027	2,166	2,808
Cash and cash equivalents	1,182	2,077	1,275
Total current assets	11,648	11,638	11,763
Total assets	11,860	11,866	11,972
EQUITY AND LIABILITIES 2)
Shareholders' equity	4,719	4,726	4,521
Long-term interest-bearing liabilities	375	426	410
Other long-term liabilities	151	166	160
Long-term provisions	2,083	2,352	2,069
Total long-term liabilities	2,609	2,944	2,639
Current interest-bearing liabilities	408	640	934
Other current liabilities	4,035	3,453	3,784
Current provisions	89	103	94
Total current liabilities	4,532	4,196	4,812
Total equity and liabilities	11,860	11,866	11,972
Pledged assets	592	447	667
Contingent liabilities	8,731	7,671	7,985
1) Of which receivables from property sales	69	54	72
2) Of which liabilities for property acquisition	689	628	704

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

	January–March		Full-year
SEK m	2016	2015	2015
Opening balance at beginning of period	4,521	4,635	4,635
Total comprehensive income for the period	321	215	960
Dividend	-	-	–600
Conversion of convertible loan	2	1	25
Equity component of convertible debentures	-	-	1
Buy-back of shares	–125	–125	–500
Closing balance at the end of the period	4,719	4,726	4,521

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

	January–March		April–March	Full-year
SEK m	2016	2015	2015/2016	2015
Cash flow from operating activities before change
in working capital and tax	398	339	1,591	1,532
Paid tax	–135	–91	–850	–806
Investment in development properties, etc. 1)	–334	–1,391	–2,555	–3,612
Payment on account for development properties, etc. 2)	663	630	2,808	2,775
Investment in project properties	–55	–24	–250	–219
Sale of project properties	1	-	52	51
Change in current liabilities/receivables	63	264	–152	49
Cash flow from operating activities	601	–273	644	–230
Cash flow from investing activities	0	–2	–9	–11
Loans raised	29	115	664	750
Amortization of debt	–600	–63	–1,089	–552
Buy-back of shares	–125	–125	–500	–500
Dividend	-	-	–600	–600
Cash flow from financing activities	–696	–73	–1,525	–902
Cash flow for the period	–95	–348	–890	–1,143
Cash and cash equivalents at end of the period	1,182	2,077	1,182	1,275
1) Of which investment in participations in tenant-owners
associations and freehold residential units	–77	–160	–262	–345
2) Of which sale of participations in tenant-owners associations and freehold residential units	87	126	371	410

KEY FIGURES

	January–March		April–March	Full-year
%	2016	2015	2015/2016	2015
Operating margin	11.6	10.9	10.9	10.8
Pre-tax return on capital employed			22.9	22.0
Return on equity			23.8	23.7
Debt/equity ratio (times)	0.2	0.0		0.3
Equity/assets ratio	40	40		38

ACCOUNTING PRINCIPLES

This interim report for the first quarter of 2016 has been prepared in accordance with IAS 34 Interim Financial Reporting and the Swedish Annual Accounts Act. 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 are applied.

The accounting policies applied in this interim report are described in the annual report for 2015, pages 68-71. The accounting principles and methods of calculation for the Group are the same as those applied in the annual report for the previous year.

REVENUE BY COUNTRY

	January–March		April–March	Full-year
SEK m	2016	2015	2015/2016	2015
Sweden	2,988	2,782	11,594	11,388
Norway	677	562	2,779	2,664
Finland	80	47	296	263
Denmark	2	9	31	38
Belgium	10	17	87	94
Restatement JM International 1)	–287	–117	–678	–508
Total	3,470	3,300	14,109	13,939

REVENUE BY BUSINESS SEGMENT

		January–March	April–March	Full-year
SEK m	2016	2015	2015/2016	2015
JM Residential Stockholm	1,704	1,545	6,432	6,273
JM Residential Sweden	1,007	737	3,548	3,278
JM International	769	636	3,192	3,059
JM Property Development	28	47	187	206
JM Construction	360	554	1,890	2,084
Elimination	–111	–102	–462	–453
Total (segment reporting)	3,757	3,417	14,787	14,447
Restatement JM International 1)	–287	–117	–678	–508
Total	3,470	3,300	14,109	13,939

OPERATING PROFIT BY BUSINESS SEGMENT

	January–March		April–March	Full-year
SEK m	2016	2015	2015/2016	2015
JM Residential Stockholm	294	263	1,109	1,078
JM Residential Sweden	105	60	353	308
JM International	43	33	176	166
JM Property Development	6	15	29	38
JM Construction	10	16	39	45
Group-wide expenses	–13	–15	–43	–45
Total (segment reporting)	445	372	1,663	1,590
Restatement JM International 1)	–42	–11	–122	–91
Total	403	361	1,541	1,499

OPERATING MARGIN BY BUSINESS SEGMENT

	January–March		April–March	Full-year
%	2016	2015	2015/2016	2015
JM Residential Stockholm	17.3	17.0	17.2	17.2
JM Residential Sweden	10.4	8.1	9.9	9.4
JM International	5.6	5.2	5.5	5.4
JM Construction	2.8	2.9	2.1	2.2

AVERAGE OPERATING CAPITAL BY BUSINESS SEGMENT

	April–March	Full-year
SEK m	2015/2016	2015
JM Residential Stockholm	4,229	4,134
JM Residential Sweden	1,249	1,289
JM International	2,093	2,145
JM Property Development	361	326

RETURN ON OPERATING CAPITAL BY BUSINESS SEGMENT

	April–March	Full-year
%	2015/2016	2015
JM Residential Stockholm	26.2	26.1
JM Residential Sweden	28.3	23.9
JM International	8.4	7.7
JM Property Development	8.0	11.7

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

OPERATING CASH FLOW BY BUSINESS SEGMENT

	January–March		April–March	Full-year
SEK m	2016	2015	2015/2016	2015
JM Residential Stockholm	460	–413	529	–344
JM Residential Sweden	174	79	628	533
JM International	31	–84	549	434
JM Property Development	69	–5	–132	–206
JM Construction	–6	108	–148	–34

DEVELOPMENT PROPERTIES BY BUSINESS SEGMENT

Carrying amount, SEK m	3/31/2016	3/31/2015	12/31/2015
JM Residential Stockholm	4,310	4,012	4,517
JM Residential Sweden	1,189	1,101	1,269
JM International	1,191	1,645	1,202
JM Property Development	35	25	35
JM Construction	44	56	44
Total	6,769	6,839	7,067

AVAILABLE RESIDENTIAL BUILDING RIGHTS BY BUSINESS SEGMENT

Number	3/31/2016	3/31/2015	12/31/2015
JM Residential Stockholm	12,300	11,900	12,400
JM Residential Sweden	9,600	9,300	9,900
JM International	8,200	7,900	8,200
JM Property Development 1)	700	600	600
Total	30,800	29,700	31,100
Of which, recognized on the balance sheet (development properties)
JM Residential Stockholm	8,300	8,200	8,700
JM Residential Sweden	5,300	5,100	5,200
JM International	4,200	4,200	4,100
JM Property Development 1)	100	100	100
Total	17,900	17,600	18,100

RESIDENTIAL UNITS SOLD BY BUSINESS SEGMENT

	January–March		April–March	Full-year
Number	2016	2015	2015/2016	2015
JM Residential Stockholm	397	375	1,622	1,600
JM Residential Sweden	319	267	1,325	1,273
JM International	211	201	853	843
JM Property Development 1)	-	-	54	54
Total	927	843	3,854	3,770

HOUSING STARTS BY BUSINESS SEGMENT

	January–March		April–March	Full-year
Number	2016	2015	2015/2016	2015
JM Residential Stockholm	372	351	1,688	1,667
JM Residential Sweden	304	265	1,267	1,228
JM International	180	132	830	782
JM Property Development 1)	-	-	54	54
Total	856	748	3,839	3,731

RESIDENTIAL UNITS IN CURRENT PRODUCTION

Number	3/31/2016	3/31/2015	12/31/2015
JM Residential Stockholm	3,801	3,332	3,627
JM Residential Sweden	1,962	1,758	1,944
JM International	1,449	1,115	1,303
JM Property Development 1)	338	430	338
Total	7,550	6,635	7,212

1) Refers to rental units and residential care units

PROJECT PROPERTIES, GROUP

Carrying amount, SEK m	3/31/2016	3/31/2015	12/31/2015
Properties under development	396	204	341
Completed commercial properties	41	34	37
Total	437	238	378

DEVELOPMENT PROPERTIES, GROUP

		January–March	April–March	Full-year
Carrying amount, SEK m	2016	2015	2015/2016	2015
Opening balance at beginning of period	7,067	6,802	6,839	6,802
New purchases	250	504	2,441	2,695
Transferred to production	–550	–419	–1,945	–1,814
Miscellaneous	2	–48	–566	–616
Closing balance at the end of the period	6,769	6,839	6,769	7,067

PARENT COMPANY

CONDENSED INCOME STATEMENT, PARENT COMPANY

		January–March
SEK m	2016	2015	2015
Net sales	2,747	2,301	9,761
Production and operating costs	–2,222	–1,866	–7,875
Gross profit	525	435	1,886
Selling and administrative expenses	–148	–138	–545
Gains/losses on the sale of property	0	13	13
Operating profit	377	310	1,354
Financial income and expenses	110	–13	1
Profit before appropriations and tax	487	297	1,355
Appropriations	-	-	–167
Profit before tax	487	297	1,188
Taxes	–80	–67	–704 1)
Profit/loss for the period	407	230	484

1) Of which SEK 409m refers to paid tax attributable to a ruling by the Administrative Court of Appeals in July for the years 2007 and 2008. The proceedings referred to impairment losses on shares in Group companies, which the Administrative Court of Appeals ruled to be non-deductible. JM had made full provisions in the consolidated accounts for a negative outcome.

CONDENSED BALANCE SHEET, PARENT COMPANY

SEK m	3/31/2016	3/31/2015	12/31/2015
Assets
Non-current assets	1,536	1,277	1,578
Current assets	7,577	7,576	7,930
Total assets	9,113	8,853	9,508
Equity and liabilities
Shareholders' equity	2,488	2,902	2,205
Untaxed reserves	1,975	1,775	1,975
Provisions	854	854	855
Long-term liabilities	343	228	353
Current liabilities	3,453	3,094	4,120
Total equity and liabilities	9,113	8,853	9,508
Pledged assets	169	169	169
Contingent liabilities	10,033	8,981	9,250

Stockholm, April 21, 2016 JM AB (publ)

Johan Skoglund President and Chief Executive Officer

The company's auditors did not review this interim report.

GROUP

FIVE-YEAR OVERVIEW

SEK m	2015	2014	2013	2012	2011
Revenue	13,939	14,216	12,603	12,480	12,001
Operating profit	1,499	1,819	1,523	1,374	1,513
Profit before tax	1,427	1,744	1,464	1,318	1,463
Total assets	11,972	12,375	11,150	11,556	11,296
Cash flow from operating activities	–230	978	898	979	733
Interest-bearing net liabilities (+)/receivables (–)	1,198	–337	–642	–667	–970
Operating margin, %	10.8	12.8	12.1	11.0	12.6
Return on equity, %	23.7	28.7	25.0	21.9	24.5
Equity/assets ratio, %	38	37	40	38	41
Earnings per share, SEK	14.50	17.00	14.10	11.70	12.50
Dividend per share, SEK	8.25,1)	8.00	7.25	6.75	6.50
Number of available building rights	31,100	29,400	27,700	26,600	27,200
Number of residential units sold	3,770	3,195	3,265	2,952	3,112
Number of housing starts	3,731	3,445	2,953	3,163	3,629
Number of residential units in current production	7,212	6,375	5,609	5,988	6,401

1) Board proposal

GROUP

QUARTERLY OVERVIEW

SEK m	2016	2015
INCOME STATEMENT	Q 1	Q 4	Q 3	Q 2	Q 1
Revenue	3,470	3,744	3,410	3,485	3,300
Production and operating costs	–2,851	–3,092	–2,886	–2,899	–2,753
Gross profit	619	652	524	586	547
Selling and administrative expenses	–217	–242	–179	–235	–210
Gains/losses on the sale of property	1	1	21	10	24
Operating profit Financial income and expenses	403 –16	411 –17	366 –24	361 –12	361 –19
Profit before tax	387	394	342	349	342
Taxes	–88	–84	–94	–83	–81
Profit for the period	299	310	248	266	261
BALANCE SHEET	03/31	12/31	9/30	6/30	3/31
ASSETS
Non-current assets	212	209	217	229	228
Project properties	437	378	326	280	238
Development properties	6,769	7,067	7,189	6,727	6,839
Participations in tenant-owner associations, etc.	233	235	229	292	318
Current receivables	3,027	2,808	2,646	2,048	2,166
Cash and cash equivalents	1,182	1,275	1,557	1,887	2,077
Total current assets	11,648	11,763	11,947	11,234	11,638
Total assets	11,860	11,972	12,164	11,463	11,866
EQUITY AND LIABILITIES
Shareholders' equity	4,719	4,521	4,358	4,277	4,726
Long-term interest-bearing liabilities Other long-term liabilities	375 151	410 160	472 150	489 158	426 166
Long-term provisions	2,083	2,069	2,047	2,455	2,352
Total long-term liabilities	2,609	2,639	2,669	3,102	2,944
Current interest-bearing liabilities	408	934	548	569	640
Other current liabilities	4,035	3,784	4,486	3,412	3,453
Current provisions	89	94	103	103	103
Total current liabilities	4,532	4,812	5,137	4,084	4,196
Total equity and liabilities	11,860	11,972	12,164	11,463	11,866
CASH FLOW STATEMENT	Q 1	Q 4	Q 3	Q 2	Q 1
From operating activities	601	–423	–193	659	–273
From investing activities	0	–2	–2	–5	–2
From financing activities	–696	143	–131	–841	–73
Total cash flow for the period	–95	–282	–326	–187	–348
Cash and cash equivalents at end of the period	1,182	1,275	1,557	1,887	2,077
INTEREST-BEARING NET LIABILITIES/
RECEIVABLES	Q 1	Q 4	Q 3	Q 2	Q 1
Interest-bearing net liabilities(+)/receivables(-)
at beginning of the period Change in interest-bearing net liabilities/receivables	1,198 –457	596 602	295 301	106 189	–337 443
Interest-bearing net liabilities(+)/ receivables(-)
at end of the period	741	1,198	596	295	106
DEVELOPMENT PROPERTIES	Q 1	Q 4	Q 3	Q 2	Q 1
Opening balance at beginning of period	7,067	7,189	6,727	6,839	6,802
New purchases	250	546	1,298	347	504
Transferred to production	–550	–486	–476	–433	–419
Miscellaneous	2	–182	–360	–26	–48
Carrying value at end of period	6,769	7,067	7,189	6,727	6,839
KEY FIGURES	Q 1	Q 4	Q 3	Q 2	Q 1
Operating margin, %	11.6	11.0	10.7	10.4	10.9
Debt/equity ratio, times	0.2	0.3	0.1	0.1	0.0
Equity/assets ratio, %	40	38	36	37	40
Earnings per share, SEK	4.10	4.20	3.30	3.50	3.50
Number of available building rights	30,800	31,100	28,700	27,900	29,700
Number of residential units sold	927	939	891	1,097	843
Number of housing starts	856	1,066	888	1,029	748
Number of residential units in current production	7,550	7,212	7,073	6,917	6,635

BUSINESS SEGMENT

QUARTERLY OVERVIEW

SEK m	2016	2015
JM RESIDENTIAL STOCKHOLM	Q 1	Q 4	Q 3	Q 2	Q 1
Revenue	1,704	1,631	1,522	1,575	1,545
Operating profit 1)	294	288	259	268	263
Operating margin, %	17.3	17.7	17.0	17.0	17.0
Average operating capital	4,229	4,134	3,823	3,530	3,336
Return on operating capital, % 2)	26.2	26.1	30.8	34.2	37.1
Operating cash flow	460	–640	457	252	–413
Carrying amount, development properties	4,310	4,517	4,536	3,928	4,012
Number of available building rights	12,300	12,400	11,900	11,500	11,900
Number of residential units sold	397	370	375	480	375
Number of housing starts	372	470	444	402	351
Number of residential units in current production 1) Of which property sales	3,801 -	3,627 0	3,354 -	3,277 -	3,332 -
JM RESIDENTIAL SWEDEN	Q 1	Q4	Q 3	Q 2	Q 1
Revenue	1,007	1,019	671	851	737
Operating profit 1)	105	102	68	78	60
Operating margin, %	10.4	10.0	10.1	9.2	8.1
Average operating capital	1,249	1,289	1,304	1,323	1,399
Return on operating capital, % 2)	28.3	23.9	20.9	18.9	16.1
Operating cash flow	174	192	–72	334	79
Carrying amount, development properties	1,189	1,269	1,251	1,190	1,101
Number of available building rights	9,600	9,900	9,100	8,900	9,300
Number of residential units sold	319	322	326	358	267
Number of housing starts	304	368	317	278	265
Number of residential units in current production	1,962	1,944	1,979	1,883	1,758
1) Of which property sales	-	0	-	-	0
JM INTERNATIONAL	Q 1	Q4	Q3	Q 2	Q 1
Revenue	769	873	658	892	636
Operating profit 1)	43	46	40	47	33
Operating margin, %	5.6	5.3	6.1	5.3	5.2
Average operating capital	2,093	2,145	2,211	2,243	2,285
Return on operating capital, % 2)	8.4	7.7	8.3	7.7	6.6
Operating cash flow Carrying amount, development properties	31 1,191	191 1,202	56 1,321	271 1,528	–84 1,645
Carrying amount, project properties	35	31	32	28	28
Number of available building rights	8,200	8,200	7,200	7,000	7,900
Number of residential units sold	211	193	190	259	201
Number of housing starts	180	228	127	295	132
Number of residential units in current production	1,449	1,303	1,256	1,273	1,115
1) Of which property sales	-	–1	20	9	11
JM PROPERTY DEVELOPMENT	Q1	Q4	Q 3	Q 2	Q 1
Revenue	28	100	14	45	47
Operating profit 1)	6	23	0	0	15
Average operating capital	361	326	273	245	237
Return on operating capital, % 2)	8.0	11.7	9.5	14.3	24.5
Operating cash flow	69	–112	–55	–34	–5
Carrying amount, development properties	35	35	25	25	25
Carrying amount, project properties	402	347	294	252	210
Number of available building rights 3)	700	600	500	500	600
Number of residential units sold 3) Number of housing starts 3)	- -	54 -	- -	- 54	- -
Number of residential units in current production 3)	338	338	484	484	430
1) Of which property sales	1	2	1	1	13
3) Refers to rental units and residential care units.
JM CONSTRUCTION	Q 1	Q4	Q 3	Q 2	Q 1
Revenue	360	480	492	558	554
Operating profit	10	0	13	16	16
Operating margin, %	2.8	0.0	2.6	2.9	2.9
Operating cash flow	–6	–65	–11	–66	108
JM OTHER	Q 1	Q4	Q 3	Q 2	Q 1
Revenue (elimination)	–111	–145	–101	–105	–102
Operating profit (Group-wide expenses)	–13	–13	–7	–10	–15
RESTATEMENT JM INTERNATIONAL	Q 1	Q4	Q 3	Q 2	Q 1
Revenue	–287	–214	154	–331	–117
Operating profit	–42	–35	–7	–38	–11
2) Calculated on 12-month rolling profits and average capital.

JM IN BRIEF

BUSINESS CONCEPT

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

VISION

JM creates houses where people feel at home.

BUSINESS

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 and Finland. We are also involved in the project development of commercial premises and contract work, primarily in the Greater Stockholm area.

JM should promote long-term sustainability work in all of its operations.

Annual sales total approximately SEK 14 billion and the company has approximately 2,300 employees.

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

FINANCIAL TARGETS AND DIVIDENDS POLICY

The operating margin should amount to 10 percent, including gains/losses from property sales. The visible equity ratio should amount to 35 percent over a business cycle.

Over time, the dividend should reflect the earnings trend in total operating activities and over a business cycle on average 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 therefore are included in the calculation of dividends.

DISCLOSURES

JM discloses the information provided herein pursuant to the Securities Markets Act and/or the Financial Instruments Trading Act. The information was submitted for publication at 2:15 PM on April 21, 2016.

FOR MORE INFORMATION PLEASE CONTACT:

Claes Magnus Åkesson, CFO, Head of IR Tel. +46 8 782 89 71

ADDITIONAL INFORMATION

FINANCIAL CALENDAR

July 15, 2016 Interim report January–June 2016

October 26, 2016 Interim report January-September 2016

PRESS RELEASES, Q1

3/21/2016 Notice of JM's Annual General Meeting on April 21, 2016

3/11/2016 JM in swap transaction with Vasakronan in Uppsala, Sweden

2/29/2016 Per Lundquist new Director of Operations Development

2/4/2016 Year-end Report 2015

1/29/2016

Conversion of Convertible debentures and warrants into shares in JM AB (publ)

1/19/2016

JM AB's Nomination Committee's Proposals for Chairman and Directors at the 2016 Annual General Meeting

JM's annual reports, interim reports and other financial information is available at www.jm.se/investors

JM AB (publ)

Telephone +46 8 782 87 00 Fax +46 8 782 86 00 Comp. Reg. No. 556045-2103 Website www.jm.se/en

Mailing address SE-169 82 Stockholm Street address Gustav III:s boulevard 64, Solna