6 Construction projects

EUR million 31 Dec 2015 31 Dec 2014
Percentage-of-completion method, continuing operations

Revenue recognised according to the percentage-of-completion method 1,453.4 1,654.1

Incurred costs and recognised net profits (less booked losses)
of work in progress projects
1,119.2 1,467.0

Gross project-related receivables from clients 29.6 32.7

Gross project-related liabilities to clients 54.5 67.4

Service concession arrangements

Lemminkäinen currently has six major ongoing life cycle projects, where subscribers are the municipalities of Kuopio, Oulu, Pudasjärvi, Hollola and Porvoo. In each of the projects, Lemminkäinen refurbishes an old or builds a new building for the municipality as well as maintains the building in question for a service period specified in the contract. The municipality owns both the buildings and the land area where the buildings are located in each of the life cycle projects. In all of the contracts, the municipality has the right to terminate the contract during the service period under certain terms and conditions taking into consideration the interests of the service provider. The prices of both the construction phase and the service period have been tied to a building cost index according to which the prices are reviewed annually. Lemminkäinen does not have a significant right to organize supplementary use for any of the properties. Key information on each of the projects is presented in the table below.

Project Contract date Construction phase Service
Kuopio, schools and a day-care center 14 Dec 2009 completed ends 2036 EUR 94 mill.
Oulu, Kastelli community center 1 June 2012 completed ends 2039 EUR 86 mill.
Pudasjärvi, school campus 13 March 2014 ends 2016 ends 2041 EUR 41 mill.
Pudasjärvi, care facility 6 Nov 2015 ends 2016 ends 2036 EUR 12 mill.
Hollola, Heinsuo and Kalliola schools 5 June 2015 ends 2017 ends 2037 EUR 49 mill.
Porvoo, schools and day-care centers 16 Dec 2015 ends 2018 ends 2038 EUR 61 mill.

*Estimate on the contract date