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2002

Shareholders in L E LundbergföretagenAB (publ) are hereby summoned tothe Annual General Meeting to beheld on Thursday, April 3, 2003, at4.00 p.m. in the World Trade Center,Klarabergsviadukten 70, Stockholm,Sweden.

Notification and registrationShareholders wishing to participatein the business of the Meeting shallbe recorded in the Securities

Register maintained by VPC (Swedish Securities Registry Center) no later than Monday, March 24, 2003,

and notify the Company of their intention to participate no later than noon, Friday, March 28, 2003 at the following address:

Notifications can be made in any ofthe following manners:• By post to L E LundbergföretagenAB (publ), S-601 85 Norrköping,Sweden• by telephone to Int. +46-11-21 6500• by telefax to Int. +46-11-21 65 65,or • by e-mail to siv.pettersson@lund-bergs.se

Notifications must include details ofthe shareholder’s name, address,telephone number, personal identifi-cation/corporate registration numberand number of shares held. If partici-pation is to be based on proxy, theproxy document must be sent to theCompany before the Annual GeneralMeeting.

To be able to vote at the Meeting,shareholders whose shares areregistered in a nominee’s name,through a bank’s trust department oran individual broker, must tempora-rily register their shares in their ownnames. Such registration must becompleted by Monday, March 24,2003. This means the nominee mustbe given adequate notice of the sha-reholder’s wishes before this date.

Financial informationThe following financial reports willbe published in Swedish and Englishon our website:

Interim Report, January-March 2003May 13, 2003

Interim Report, January-June 2003August 22, 2003

Interim Report, January-September2003 November 12, 2003

Year-end Report 2003 February2004

The Annual Report will be sent toshareholders who have notified VPCthat they wish to receive it.

Form och produktion: Wildell Integrerad Kommunikation ABText: LundbergsTryck och repro: Redners Offsettryckeri ABPapper: Omslag Silverblade Silk 250 g, Inlaga Silverblade Silk 150 gFoto: Dag Sundberg: sid 4, 18, 22, 24, 26, 28, 30, 60–61, 62–63Nino Monastra: sid 12–14, 17, 32, 54–59Tryckdatum: 17 mars 2003

Annual General Meeting

Contents

Lundbergs 2

The year in brief 3

The President’s review 4

Net asset value 6

The Lundberg share 8

Financial position 10

Five-year review 11

Real Estate 12

Invest 18

Cardo 22

Holmen 24

Hufvudstaden 26

NCC 28

Stadium 30

Report of the Board of Directors 32

Income statements 36

Cash flow statements 37

Balance sheets 38

Notes 40

Accounting principles 49

Proposed distribution of profits 52

Auditors’ report 52

Definitions 53

Real estate specification 54

Board of Directors 60

Senior executives and Auditors 62

Addresses 64

Lundbergs was formed by Lars Erik Lindberg in 1944 as a construction compa-ny focusing on proprietary building operations. Lars Eric Lundberg was theCompany’s President until 1975. He was then appointed Chairman of theBoard, a position he retained until 1991.

Since 1981, Fredrik Lundberg has been the Group’s Chief Executive Officer.Over the years, Lundbergs has evolved from pure construction into a property-management and investment business. Today, operations are divided into twobusiness areas: Real Estate and Invest.

Lundbergs’ general business concept is to engage in the long-term manage-ment and development of properties and in long-term investments in sharehold-ings, mainly in publicly traded Swedish companies, in order to generate a highabsolute return on investments.

The Real Estate business area consists of Lundbergs’ own real estate opera-tions. The real estate portfolio mainly comprises centrally located residential,office and retail properties in 18 municipalities. The properties in the portfoliowere predominantly built in the 1960s and 1970s.

Lundberg Real Estate’s business concept is to manage and develop residen-tial and commercial properties in cities where favorable growth is expected.This is achieved with the help of a decentralized, efficient and market-adaptedorganization that possesses expert knowledge of customer needs and offerswell-managed properties combined with good service. The Real Estate businessarea’s Head Office is in Norrköping.

The Invest business area’s business concept is to function as an active, long-term owner that manages and develops a limited number of investments inSwedish, mainly publicly traded, companies. The business area’s strategy is tocontribute expertise and stability at the ownership level, thus creating condi-tions in which the companies can conduct solid and profitable operations.Lundbergs is the principal shareholder in Cardo, Holmen and Hufvudstadenand the second largest shareholder in NCC. Lundbergs also has a major share-holding in Stadium, a sports-products and sports-fashion company.

Lundberg Invest also engages in securities trading through the subsidiary L ELundberg Kapitalförvaltning AB. The Head Office of investment operations is inStockholm.

Invest

Lundbergs

Real Estate

• Profit after full tax amounted to SEK 597 m. (1,986), which corresponds to SEK 9.62 (31.48) per share. The figure for 2001 included an extra dividend ofSEK 1,307 m. from Holmen and tax revenue of SEK 88 m.

• On December 31, 2002, estimated net asset value per share was SEK 246 (247) before and SEK 221 (220) after deferred tax. The corresponding values on February 19, 2003 were SEK 240 and SEK 217 per share, respectively.

• Real estate operations reported profit of SEK 400 m. (315), an increase of 27%.

• Since summer 2002, approximately SEK 1 billion has been invested in Industrivärden shares. Lundbergs’ ownership interest amounts to 5% of the share capital and 7% of the voting rights.

• An increase in the dividend to SEK 6.00 (5.75) per share is proposed.

•3

The year in brief

Earnings and key data1

2002 2001Net sales, SEK m. 1,197 2,489Profit after financial items, SEK m. 652 1,898Profit after full tax, SEK m. 597 1,986

Earnings per share, SEK 9.62 31.48Net asset value per share, SEK 246 247Net asset value per share after deferred tax, SEK 221 220Shareholders’ equity per share, SEK 156 152Dividend per share, SEK 6.002 5.75

Debt/equity ratio, % 0.25 0.19Equity/assets ratio, % 76 78Number of employees 211 212

1) In order to provide a true and fair description of the Group’s operations, the holdings in Cardo, Holmen, Hufvudstaden, NCC and Stadiumare reported solely as shareholdings (other long-term holdings of securities) and are thus not consolidated in the Group.

2) The Board of Directors’ proposal.

•4 In many respects, 2002 was a turbulentyear. Naturally, I am thinking aboutthe conflicts in the Middle East, corporate scandals, terrorist attacksand the severe stock-market slumpexperienced in many parts of theworld. The repercussions of thesefactors affected everyone’s behaviorand thus economic growth.Stockholmsbörsen plummeted 37%,marking the third consecutive year offalling share prices, something thathad not happened since the economiccrises of the early 1930s – the totalmagnitude of the collapse during2000-2002 was at the same level asthen.

Lundbergs, however, successfullymaintained its positions during 2002.We reported profit of approximatelySEK 597 m. after tax (1,986) and netasset value of SEK 221 (220) after de-ferred tax. The reason for the reducedearnings compared with the precedingyear is that earnings in 2001 includedan extraordinary dividend of SEK

1,307 m. from Holmen, as well as atax revenue of SEK 88 m.

The price of Lundberg shares rose23% during 2002, which meantshareholders received a total return of27% for the year. During the past tenyears, our shareholders have receiveda total annual return of 19%.

Our financial position remainsstrong. Net debt amounted to SEK 2.4billion (1.4) at year-end, equal to adebt/equity ratio of 0.25 (0.19).

Real estateOperating profit increased to SEK400 m. (315). Profit before depreciationand write-downs amounted to SEK422 m. (414).

The rental market for offices dete-riorated in virtually all of the locationsin which we are active. This appliedparticularly to Stockholm, wherecompany bankruptcies and the down-sizing of various businesses resultedin excess supply of office premises.This also led to a decrease in market

rents. Central parts of Stockholm fared relatively well, while many peripheral locations were hit moreseverely.

With respect to retail space, weare still noting strong demand inStockholm and other parts of Sweden,combined with stable market rents.This trend is mainly attributable tofavorable consumption levels.

Demand for housing remainsstrong, even in smaller towns. The mainreasons for this are the low level ofresidential construction in Swedenand increases in real wages in recentyears. In most large cities, the vacancyrate for housing is very close to zero.

The vacancy rate for commercialpremises in Lundbergs’ real estateportfolio amounted to 3.9% inFebruary 2003, compared with 4.1%a year earlier. The vacancy rate forhousing remains low at 0.6%.

Since housing accounts for half ofour real estate portfolio and the port-folio is favorably diversified in terms

The President’s review

of geographic location, the level ofrisk is relatively low. Accordingly, Iam of the opinion that this businessarea will continue to report healthyearnings in the years ahead.

InvestLundberg Invest’s business concept isto function as an active, long-termowner that manages and develops alimited number of investments inSwedish, mainly publicly traded,companies.

Our earnings objective is to gener-ate an absolute return – in the form ofappreciation and the direct return oninvested capital – that substantiallyexceeds the yield on a risk-free interest-bearing investment over time.In other words, we do not compareour performance with an equity index, because our investments areconcentrated in a limited number ofcompanies.

We concentrate on companiesactive in areas in which we have theappropriate experience and knowledgeand where the prospects for obtaininga favorable return are good. During2002 and early 2003, we made a ma-jor new investment totaling about SEK1 billion in shares in the investmentcompany Industrivärden. Lundbergs’ownership interest amounts to 5% ofthe share capital and 7% of the votingrights. Industrivärden has majorshareholdings in many companies, including a number of Sweden’sstrongest groups, such as SvenskaHandelsbanken, SCA and Sandvik.

For many years, Lundbergs’ invest-ments have been concentrated in thereal estate and forest products sectors.The Industrivärden investment providesus with a certain diversification of riskoutside these sectors. We also believethat the time is now right, after theprotracted slump in share prices, to in-crease our exposure to the stock market.

Holmen reported favorable earningsfor 2002. Although Holmen Paper(printing paper) reported slightlylower profits, its earnings level remainssatisfactory. Iggesund Paperboardposted much higher earnings than in2001, in part because of a positivetrend for its UK paperboard plant inWorkington and in part because of ahealthy trend for the Iggesund mill.Earnings from sawn timber productsalso improved.

At the end of 2002, Holmen acquired the power assets with a value of SEK 1.7 billion that it haddivested as part of a sale-leasebacktransaction at the beginning of the1980s.

In January 2002, Holmen’s Boardof Directors decided to commissionthe project planning of a new newsprintmachine to be located at Holmen’spaper mill in Spain. Due to the current-ly weak economic climate and low de-mand for newsprint, Holmen’s Boardof Directors decided in February2003 to postpone this investment until further notice.

Hufvudstaden reported improvedprofit for 2002 compared with thepreceding year, mainly as a result ofan increase in rental revenues. Profitwas charged with substantial rebuild-ing costs and was also inhibited bylosses of rental revenue resulting fromthe project planning of theNorrmalmstorg 1 and NK propertiesin central Stockholm.

Most of the Norrmalmstorg 1 property, in which Danske Bank andZara will be major tenants, will becompleted during 2003.

During 2002, Cardo divested itsRail business area for about SEK 2billion. The weak economic situationin Europe had an adverse impact onCardo’s earnings, particularly those ofthe Door business area. Cardo Pumpimproved its earnings, as a result of

the cost-saving measures it has imple-mented. The sale of Rail improvedCardo’s financial position significantly,resulting in a net cash position ofabout SEK 600 m. at the end of 2002.As a result, Cardo’s Board has decidedto propose that the company’s AnnualGeneral Meeting approve an extraor-dinary dividend of SEK 32 per share.

NCC’s earnings improved sharplyduring 2002, mainly because of thecost-saving measures implementedduring autumn 2001 and throughout2002.

In February, NCC’s Board ofDirectors decided to propose to theAnnual General Meeting that sharesin Altima, the company’s wholly owned rental-machinery subsidiary,be spun off to NCC shareholders. As aresult, NCC’s streamlining will contin-ue and Altima’s growth prospects willincrease if it operates as an indepen-dent company

Stadium’s sharp volume expansioncontinued in 2002. Several new storeswere opened, mainly in Sweden butalso in Finland and Denmark. It isestimated that the prospects for further expansion will be favorable inthe years ahead.

Outlook for 2003As a result of the proposed increasesin dividends from our shareholdings,including an extraordinary dividendof about SEK 322 m. from Cardo, theInvest business area is expected toshow a significant increase in earningsin 2003. Earnings from the Real Estatebusiness area are expected to remainat the same level as in 2002.

Stockholm, February 20, 2003

Fredrik Lundberg

•5

•6

Net asset value

Calculation of net asset valueLundbergs’ net asset value can becalculated on the basis of marketvaluations of the Group’s assets,less liabilities and deferred tax onhidden reserves.

The Group’s estimated net assetvalue at year-end 2002 was SEK246 (247) per share before deferredtax1) and SEK 221 (220) after deferred tax2).

Reported shareholders’ equityaccounted for SEK 156 (152) of netasset value per share (11).

On February 19, 2003 estimatednet asset value per share was SEK240 before and SEK 217 after de-ferred tax.

1) Valuation principles for Real EstateThe value of the real estate portfolio is based on both independent and internal valuations. Internal valuations have been made of various parts of the holdings. The valuations are based on actual net revenues and actual operating expenses (including property tax) for 2002,while repair costs have been estimated on a standard basis. Residential properties have been charged with a repair cost corresponding to SEK 100 per square meter and commercial premises (retail, office and industrial properties) SEK 50 per square meter. Thereafter, the estimated operating net has been recomputed to include the estimated required yield for each part of the real estate holdings. In those cases where independent valuations have been conducted, these have replaced the internal valuations. The average yield for completed properties was 8.1% (7.7) in 2002. The estimated market value of the real estate portfolio was SEK 6,814 m., of which approximately SEK 1,386 m. was based on independent valuations.

Valuation principles for Invest Publicly traded securities are entered at actual market prices or, if options have been written, at the exercise price, if this is lower. Assets notlisted on the stock exchange are reported at book value

Other assets and liabilitiesOther assets and liabilities are reported at book value.

2) Deferred taxThe calculation of deferred tax is based on the difference between the market value and book value of properties and publicly traded shares. A tax rate of 28% has been used. Other deferred tax is included in the line Interest-free liabilities, net.

Dec 31,2002 Dec 31, 2001SEK m. SEK/share SEK m. SEK/share

Real EstateCompleted properties 6,631 107 6,660 107Development properties 183 3 184 3Total Real Estate 6,814 110 6,844 110

InvestMajor shareholdings

Cardo 2,018 32 1,589 26Holmen 4,648 75 5,153 83Hufvudstaden 2,544 41 2,485 40Industrivärden 872 14NCC 729 12 967 15Stadium 250 4 250 4

Asset ManagementListed shares 198 3 323 5

Total Invest 11,259 181 10,767 173

Interest-bearing assets 64 1 252 4Interest-bearing liabilities -2,449 -39 -2,023 -32Total net interest-bearing debt -2,386 -38 -1,771 -28

Interest-free liabilities, net -442 -7 -509 -8

Net asset value before deferred tax 1 15,245 246 15,331 247

Deferred tax 2

Deferred tax, Real Estate -1,133 -18 -1,142 -18Deferred tax, Invest -421 -7 -524 -9Total deferred tax -1,553 -25 -1,666 -27

Total net asset value after deferred tax 13,692 221 13,665 220of which, reported equity 9,675 156 9,447 152

Market value 12,105 195 9,819 158Price/net asset value, % 88 72

•7

Trend of net asset valueNet asset value has risen by an average of 11.7% during the period.

Net asset value after deferred tax

Deferred tax

SEK/SHARE

250

200

150

100

50

0

1998 1999 2000 2001 2002

Series B Lundberg shares are listed onStockholmsbörsen’s O List. A roundlot consists of 100 shares. During2002, an average of 32,400 Series Bshares were traded per trading day.Total share turnover amounted to 8million Series B shares, correspondingto 21% of the total number of Series Bshares. The lowest price paid for theshare in 2002 was SEK 148 and thehighest was SEK 202. Lundbergs’market capitalization at year-end wasSEK 12,105 m. (9,819).

The share price rose by 23% duringthe year. Affärsvärlden’s index for investment and management compa-nies declined by 41% during thesame period.

Share capitalThe share capital of L E Lundberg-företagen AB (publ) amounted to SEK621 m. (683) during the year. OnDecember 31, 2002, the total numberof shares was 62,145,483 (68,292,383),each with a par value of SEK 10. The

shares are divided into 24,000,000(24,000,000) Series A shares, carryingten votes per share, 38,075,083(44,292,383) Series B shares, carryingone vote per share, and 70,400 repur-chased Series B shares.

Repurchase of own sharesThe Annual General Meeting on April4, 2002 approved the cancellation ofthe 6,146,900 previously repurchasedSeries B shares. The Meeting also renewed the Board’s authorization torepurchase Lundberg shares duringthe period up to the next AnnualGeneral Meeting. The Board has decided to exercise the authorizationreceived from the Annual GeneralMeeting. The purchases are subject tothe limitation that the Company’sholding may not exceed 10% of thetotal number of shares in theCompany, corresponding to6,214,000 shares, at any time. As atDecember 31, 2002, 70,400 of theseshares had been repurchased for SEK

12 m., or an average of SEK 178 pershare. The repurchased shares corre-sponded to 0.11% of the share capitaland 0.03% of the voting rights. Noadditional shares were repurchasedduring the period up to and includingFebruary 20, 2003.

The average number of shares out-standing during 2002 was62,087,620. The number of sharesoutstanding on December 31, 2002was 62,075,083.

The Board of Directors proposesthat the Annual General Meeting onApril 3, 2003 authorize the Board torepurchase Series B Lundberg sharesduring the period up to the 2004Annual General Meeting, subject tothe limit that the Company’s holdingmay not exceed 10% of the totalnumber of Lundberg shares at anypoint in time. The reason for the repurchase authorization is to enablethe Board to adjust the Company’scapital structure.

Lundbergs Serie B Afv Investment and Management IndexAfv General Index No. of shares traded

SEKThousands

/month

0

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2,000

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030201009998

•8

The Lundberg share

•9

Largest shareholders

Feb 2003 Feb 2002Holding as % of Holding as % of

share capital votes share capital votesFredrik Lundberg,

incl. companies 51.9 89.3 47.2 89.3Louise Lundberg 7.5 1.7 6.8 1.7Katarina Lundberg 7.5 1.7 6.8 1.7Zenitfonden 3.2 0.7 2.9 0.7FPG 2.3 0.5 2.3 0.6AMF Pension 1.9 0.4 1.2 0.3Confederation of Swedish Enterprises1.9 0.4 1.8 0.5Robur mutual funds 1.3 0.3 0.3 0.1Third AP fund 1.2 0.3 0.7 0.2Foundation for Knowledge and Skills Development 1.1 0.3 1.0 0.3Others 20.1 4.4 20.0 4.6Subtotal 99.9 100.0 91.0 100.0L E Lundbergföretagen 0.11 – 9.0 –Total 100.0 100.0 100.0 100.0Swedish shareholders 98.7 99.7 95.4 99.0Foreign shareholders 1.3 0.3 4.6 1.01) The Company’s own holding of repurchased Lundberg shares amounts to 70.400.

Key financial data

SEK per share 2002 2001 2000 1999 1998Profit after full tax 9.62 31.48 11.16 21.87 8.54Dividend 6.001 5.75 5.25 4.75 4.25Payout ratio, % 62 18 47 22 50Cash flow2 -1.08 1.60 -1.46 0.37 0.49Market price, December 31 195 158 142 115 93.50Direct return, % 3.1 3.6 3.7 4.1 4.5P/E ratio 20 5 13 5 11Shareholders’ equity 156 152 127 124 106Net asset value after

deferred tax 221 220 205 196 142Market price/net asset

value, % 88 72 69 59 661) The Board of Directors’ proposal.2) Cash flow pertains to the change in cash and bank balances during the year according to the cash flow

statement. Calculation of cash flow per share is based on the average number of shares outstanding.

Trend of share capitalShare capital

Total paid-in/ Added/SEK m. paid-out amount canceled Total1981 Bonus issue, 3:1 75 1001982 Bonus issue, 1:1 100 2001983 New issue 300 30 2301984 Bonus issue, 1:1 230 4601989 New issue 412 46 5061990 Bonus issue, 1:2 253 7592000 Cancellation of repurchased shares -909 -76 6832002 Cancellation of repurchased shares -884 -62 621

Distribution of shares

No. of As % As % of Average no.share- all share- No. of share- of shares/

Shareholding holders holders shares held capital shareholders1 - 500 5,548 74.5 922,922 1.5 166501 - 2,000 1,335 17.9 1,416,406 2.3 1,0612,001 - 5,000 268 3.6 914,737 1.5 3,4135,001 - 20,000 196 2.6 2,006,941 3.2 10,23920,001 - 50,000 53 0.7 1,702,692 2.7 32,12650,001 - 52 0.7 55,181,785 88.8 1,061,188Total 7,452 100.0 62,145,483 100.0 8,339

Ownership structureLundbergs has a total of about 7,500shareholders (approx. 6,700), ofwhom some 4,300 (approx. 3,700)are registered in a nominee’s name

and about 3,200 (approx. 3,000) inthe owner’s own name. With respectto the holdings of shareholders regist-ered outside Sweden, it is not possibleto distinguish directly owned from

nominee-registered shares. Foreignownership amounts to about 1% (5)of the share capital.

•10

Financial position

0

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Debt/equity ratioEquity

Net debt

SEK m.

Equity, net debt and debt/equity ratio

Low financial riskLundbergs’ strategy is to create sustainable value growth while main-taining financial balance. Since, to aconsiderable extent, Lundbergs is anequity-managing company, a strongfinancial position is an essential re-quirement. The financial risk is mini-mized by maintaining a low debt/eq-uity ratio combined with good accessto funds. The year-end equity/assetsratio was 76% (78). An additional aimis to maintain a low interest-rate andrefinancing risk. Credit risks are limit-ed by having interest-bearing assetsthat consist exclusively of instrumentswith a high credit rating.

Net interest-bearing debtNet interest-bearing debt amountedto SEK 2,386 m. (1,771) at year-end,which corresponds to a debt/equityratio of 0.25 (0.19) based on reportedshareholders’ equity.

Interest-bearing assetsInterest-bearing assets consist mainlyof instruments with good liquidityand short maturities. Investments aremade primarily in securities issued bythe Kingdom of Sweden or well-estab-lished Swedish financial institutions.The aim is to avoid credit risks and tomaintain a low interest-rate risk.Interest-bearing assets at year-end, in-cluding cash and bank balances andshort-term investments, amounted toSEK 64 m. (252).

Interest-bearing liabilitiesInterest-bearing liabilities amountedto SEK 2,449 m. (2,023) at the end of2002. On the same date, the averageperiod of fixed interest was 23months and the average interest ratewas 4.4% (3.9). Of the total interest-bearing liabilities, property mortgagesaccounted for SEK 1,042 m (42) andother interest-bearing liabilities for

SEK 1,407 m. (1,981). In total, loanswith security in properties accountedfor 37.7% (1.5) of the book value ofthe real estate portfolio in the Group.

Committed lines of creditIn addition to raised loans of SEK 1billion, Lundbergs had committed,long-term lines of credit totaling approximately SEK 1 billion onDecember 31, 2002, with a weightedmaturity of 7,4 years. Lundbergs alsohad a total of SEK 1.1 billion in committed lines of credit with a maturity of less than 12 months.

Commercial paper programIn January 2001, the wholly ownedsubsidiary Fastighets AB L E Lundberg(publ), with a surety from the ParentCompany, signed an agreement regarding the issue of commercial paper in the Swedish money marketin a total nominal amount of notmore than SEK 2 billion, or the equiv-alent value in EUR. On December 31,2002, commercial paper totaling SEK600 m. (1,650) had been issued.

Credit ratingThe Standard & Poor’s credit-ratinginstitute has assigned Lundbergs along-term rating of A/stable outlookand short-term ratings of A-1 and K-1.These high ratings facilitate less expensive borrowing and more effectiveaccess to money and bond markets.

Maturity periods for interest-bearing liabilities

SEK m. Total2003 1,4072006 5002007 500Later 42Total 2,449

Maturity periods for loans

Average interestSEK m. Total rate, %2003 1,449 4.12006 500 5.02007 500 5.1

•11

Five-year review

SEK m. 2002 20012 20011 1999 1998

INCOME STATEMENT

Operating revenuesReal Estate 821 785 742 1,192 966Invest 375 1,704 643 1,244 437Total revenues 1,197 2,489 1,385 2,436 1,403

Operating profitReal Estate 400 315 277 711 405

of which, sales of properties 3 2 4 425 84of which, adjustment of property values 10 -62 -4 3 12

Invest 359 1,687 626 1,235 402Central administrative costs -8 -8 -8 -9 -10Items affecting comparability 28Total operating profit 751 1,994 923 1,937 797

Financial items -99 -96 -65 -61 -102Profit after financial items 652 1,898 858 1,876 695

Current tax -42 60 -64 -216 -47Deferred tax -13 28 -2

Reported net profit for the year 597 1,986 792 1,660 648

BALANCE SHEET

AssetsFixed assets 12,417 11,533 8,589 7,848 6,915Properties classified as current assets 126 133 2,835 2,776 3,234Current assets 231 461 120 533 436

Shareholders’ equity and liabilitiesShareholders’ equity 9,675 9,447 8,286 9,380 8,043Long-term liabilities 1,468 483 2,530 951 934Current liabilities 1,631 2,197 728 826 1,608

Total assets 12,774 12,127 11,544 11,157 10,585

KEY FIGURESShareholders’ equity, SEK m. 9,675 9,447 8,286 9,380 8,043Equity/assets ratio, % 76 78 72 84 76Return on equity, % 6 22 9 19 8Net interest-bearing debt, SEK m. 2,400 1,800 2,500 650 1,750Debt/equity ratio 0.25 0.19 0.30 0.07 0.22Yield on completed properties, % 18 18 13 13 12Net investments in wholly and partly owned properties, SEK m 24 24 59 -459 -199Net investments in Invest, SEK m. 883 455 704 801 1,806Market value of listed shares, SEK m. 11,008 10,517 11,827 11,494 6,892Average number of employees 211 212 227 241 274

1) As of 2000, the comparative figures have been recomputed in accordance with the Financial Accounting Standards Council’s RR 9 recommendation,Income Taxes.

2) As of 2001, the Financial Accounting standards Council´s RR 12 recommendation, Tangible Fixed Assets, is applied.

•12

Real Estate

Lundbergs is one of the major private real estate owners in Sweden. The Real Estate1

business area includes Lundbergs’ own real estate operations, which at year-endconsisted of 157 wholly or partly owned completed properties and about 100 development objects, as well as a number of external management assignments.

Lundbergs’ own properties, including development properties, have an estimatedmarket value of SEK 6,814 m. (6,844) and a book value of SEK 2,769 m. (2,766). Thebusiness area manages a total of 1,245,000 square meters of floor space. Lundbergs’real estate portfolio comprises 54% (54) residential and 46% (46) commercialpremises, etc. Geographically, the business area is active in 18 Swedish municipalities.

1) The Hufvudstaden holding is not included in the Real Estate business area.

•13

Business concept and strategyLundberg Real Estate’s business con-cept is to manage and develop resi-dential and commercial properties inmunicipalities where favorablegrowth is expected.

The strategy is to have a decentral-ized, efficient and market-oriented organization that possesses expertknowledge of customer needs andcan thus offer well-managed proper-ties combined with good service.

Property-development operationsare also conducted, in order to generatethe best possible operational and development gains based on the potential of each individual property.

MarketThe economic slowdown that occurredduring the year had an adverse impact on the office-rental market inthe Stockholm region and other majormetropolitan regions, thus increasingvacancies and reducing rents. The de-mand for housing and retail premisesin major metropolitan regions andcities with colleges and universitiesremained favorable.

Lundbergs’ real estate portfolioconsists primarily of centrally locatedresidential and commercial properties,the majority of which were built bythe Company. The central location of

the properties in the various townsprovides competitive advantages inrelation to commercial and residen-tial properties situated in peripheralareas. The even distribution betweenresidential and commercial propertiesmakes the operations less sensitive toeconomic fluctuations.

The strong local presence ofLundbergs’ property-management operations results in excellent knowl-edge of the conditions and potentialin the various markets. Thanks to itsexpert knowledge of the market, supported by long-standing experi-ence of property-management andconstruction operations, the organi-zation is able to efficiently combinethe role of property manager with ahigh level of tenant service.

Organization and operationsProperty-management operationswere reorganized during the year andnow consist of five regions, with affili-ated management offices. Day-to-dayproperty-management and renting activities are conducted locally ineach municipality. Property-develop-ment operations are conducted centrally from the Norrköping office.The Real Estate business area’s HeadOffice in Norrköping has resources insuch fields as administration, opera-

tion, business control, finance, purchasing, information, IT and environmental and quality matters.

Quality and the environmentThe Real Estate business area’s opera-tions have been quality certified inaccordance with ISO 9001 since1998. As the main environmental issues are integrated into the existingquality-control system, a separate environmental certification based onISO 14001 is not considered necessary.

•14

Continued, Real Estate

Vacancy rates

0

5

10

15

20

25

30

35

40

1990-2002

1980-1989

1970-1979

1960-1969

1950-1959

before1950

% of total floor space

Age structure of completed properties

Operating revenuesThe Real Estate business area had op-erating revenues of SEK 821 m. (785).In addition to rental revenues and interest subsidies, operating revenuesinclude gains on sales of propertiesand other revenues.

Rental revenues (including interestsubsidies) amounted to SEK 814 m.(781). The increase was attributable tohigher rents. The average vacancy ratefor 2002 was 2.6% (2.3). The vacancyrate in February 2003 was 2.1%.

Properties were sold for SEK 4 m.(10) during 2002, generating capitalgains of SEK 0 m. (2). Due to anadjustment of capital gains in prioryears, total gains amounted to SEK 3 m. (2).

Property costsOperating expenses amounted to SEK166 m. (163).

Property tax rose to SEK 37 m.(33), due to the net effect of higher in-dexing ratios and a reduction in thetax rate for housing.

Expensed costs for maintenanceand tenant-oriented property im-provements rose by SEK 15 m. to SEK123 m. (108), mainly as a result of in-creased costs for tenant-oriented

property improvements, which accounted for SEK 58 m. (47).

Direct sales and administrativecosts amounted to SEK 41 m. (42).

Depreciation according to plan,which corresponds to 1 - 2% of theproperties’ acquisition value, amountedto SEK 29 m. (30).

The properties are entered in theaccounts at acquisition value or esti-mated real value, whichever is lower.Net reversals of previous write-downsamounted to SEK 10 m. (write-down:62) during the year.

Administrative costsCentral administrative costs includecosts for corporate resources employedin real estate operations, in such areasas administration, accounting, infor-mation and IT. In 2002, these costsamounted to SEK 31 m. (25).

Operating profitThe Real Estate business area’s operat-ing profit rose 27% to SEK 400 m.(314).

InvestmentsNet investments in wholly or jointlyowned properties during 2002amounted to SEK 24 m. (24).

Completed propertiesLundbergs’ 157 wholly or jointlyowned completed properties com-prise a total of 1,009,000 square meters of floor space. The propertieshave a book value of SEK 2,643 m.(2,633) and an estimated market value of SEK 6,631 m. (6,660). Thecompleted properties consist primarilyof rental apartments and large com-mercial premises and office buildings.

The oldest property was built inaround 1750 and the newest in 1998.However, most of the buildings originate from Sweden’s construction

%

0

1

2

3

4

5

6

7

1998 1999 2000 2001 2002 Feb 2003

TotalCommercial premisesHousing

December 31 2002 2001 2000Number of municipalities 18 18 18Number of completed properties 157 161 153Floor space, completed prop-erties,thousands of sq. m. 1,009 1,010 1,006

of which, housing 549 549 549of which, commercial premises 460 461 457

%

0

1

2

3

4

5

6

7

1998 1999 2000 2001 2002 Feb 2003

Gothenburg 11%

Stockholm17%

Mälardalen 22%

Western 23%

Eastern 27%

•15

Distribution of floor space by region,1,009,000 square meters

Gothenburg 12%

Western 22%

Mälardalen17%

Eastern 24%

Stockholm 25%

Distribution of rental revenues by region,SEK 811 m.

Other 10%

Retail15%

Office27%

Housing48%

Distribution of rental revenues by category, SEK 811 m.

Other 21%

Retail 9%

Office 16%

Housing54%

Distribution of floor space by category1,009,000 square meters

boom of the 1960s and 1970s. Theportfolio has been supplemented overthe years, mainly through the addi-tion of commercial properties duringthe 1980s and 1990s.

The completed properties are located in 18 municipalities, fromGothenburg in the west to Stockholmin the east.

Towns with more than 75,000 inhabitants account for 76% (76) oftotal rentable floor space. In each municipality, both the residential andthe commercial properties are locatedcentrally with good access to servicesand transport facilities. In terms of or-ganization, operations are divided intothe following five regions: Eastern,Western, Mälardalen, Stockholm andGothenburg.

Eastern regionThe Eastern region consists of thetowns of Linköping and Norrköping,with the latter accounting for 88% ofthe region’s rental floor space. The real estate holdings in the region con-sist of commercial shopping-centerpremises, centrally located housingand a number of industrial properties.The rental situation for housing andretail space is favorable throughoutthe region, while demand for officespace is weak.

Western regionThe Western region consists of Arvika,Falköping, Jönköping, Karlstad andÖrebro, with Jönköping and Karlstadjointly accounting for nearly 70% oftotal rentable floor space in the re-gion. The real estate holdings in theregion consist mainly of housing(68%). As a result of favorable demand for housing, the rental situa-tion is excellent throughout the region.

Mälardalen regionThe Mälardalen region includesEnköping, Eskilstuna, Katrineholm,Motala and Nyköping. The real estateholdings in the region consist mainlyof housing (76%). A healthy trend wasnoted in most of the municipalities,due to their close proximity toStockholm.

Stockholm regionThe Stockholm region consists ofSolna, Stockholm, Södertälje andUppsala. Demand for housing is verystrong throughout the region. Marketconditions for commercial premisesremain buoyant for retail space, al-though demand for offices is declining.

Gothenburg regionThe Gothenburg consists ofGothenburg and Landskrona. Theproperties in central Gothenburg consist of three relatively large units,mainly comprising office space.Despite the weak demand for officesin Gothenburg, Lundbergs’ propertiesare currently fully rented. The holdingin Landskrona is a large industrialproperty.

0

500

1,000

1,500

2,000

2,500

3,000

More than 4 rooms

4 room3 room2 room1 room

20012002

Numberof units

Residential apartments by type

•16

Continued, Real Estate

HousingLundbergs’ residential properties aremainly situated in central locations.Total residential floor space amountsto 549,000 square meters, which cor-responds to 54% of total rentablefloor space in Lundbergs’ completedproperties.

There are 7,584 (7,572) apartments,mostly with two or three rooms.

Thanks to the properties’ centrallocation, concentration to municipali-ties showing healthy growth and thepredominance of smaller apartments,the occupancy rate for the total hous-ing portfolio is high. The contributionmade by Lundbergs’ employees isnaturally a major factor in maintain-ing good relations with tenants andthe decentralized manner in whichthey work has proven to be success-ful.

Commercial premisesThe commercial properties consistmainly of centrally located office andretail premises, as well as a few in-dustrial buildings. Total rentable floorspace (including garage spaces)amounts to 460,000 square meters.

The real estate portfolio contains atotal of 965 (956) commercial leases,of which leases for less than SEK 1 m.account for 91% (91) and for a totalof 39% (39) of rental revenues.

The lease expiration dates arewidely spread and leases expiring asof 2006 account for 54% (56) of totalrevenues from commercial premises.The average remaining term for cur-rent leases is 3.6 years (3.7).

Operating revenuesGross rental revenues from complet-ed properties rose 4.4% to SEK 831m. (796), of which housing accountedfor SEK 395 m. (385), commercialpremises for SEK 407 m. (383) andother properties for SEK 29 m. (28).

Rental revenues including interest subsi-dies amounted to SEK 811 m. (778), ofwhich housing accounted for SEK 393m. (383), commercial premises for SEK392 m. (369) and other rents for SEK 26m. (26). The increase was attributable tohigher rents.

The vacancy rate for all completedproperties was 2.6% (2.3). The vacan-cy rate for housing was 0.6% (0.9)and the rate for commercial premiseswas 4.4% (3.6). The total vacancy ratein February 2003 was 2.1%, the resultof vacancy rates of 0.6% for housingand 3.9% for commercial premises.No completed properties were soldduring the year.

Property costsOperating expenses, which mainlyconsist of heating, electricity, waterand janitorial costs, amounted to SEK165 m. (161), of which heating ac-counted for SEK 60 m. (60).

Net property tax decreased to SEK36 m. (32), due to the net effect ofhigher indexing ratios and a reducedtax rate for housing.

Costs for maintenance and tenant-oriented property improvements roseto SEK 123 m. (108), due mainly tohigher costs for tenant-oriented prop-erty improvements, which accountedfor SEK 58 m. (47).

The operating net was SEK 486 m.(477), up 1.9%. The completed prop-erties generated a yield of 18.4%

% of rentalSEK m. Number revenues< 1 878 191–3 64 133–5 14 7> 5 9 10Total commercial premises 965 49Housing 7,584 48Other 9,669 3Total 18,218 100

Value of rental contracts

%2003 42004 72005 102006 92007 62008+ 10Total commercial premises 46Housing 48Garage 3Other 3Total 100

Maturity of rental contracts distributed by rental revenues

Operatingas a % of book

Floor space Rental Operating Book value value (annua-SEK m. in 1,000 sq. m. revenues net Dec 31, 2001 lized yield)Eastern region 269 198 89 774 11.5Western region 233 180 111 615 18.0Mälardalen region 225 141 78 339 23.0Stockholm region 176 199 134 469 28.6Gothenburg region 106 93 74 446 16.6Total 1,009 811 486 2,643 18.4

Completed properties 2002, summary

•17

(18.1) in relation to book value.Direct sales and administrative costsamounted to SEK 40 m. (40). During2002, the completed properties weredepreciated by SEK 29 m. (30) corre-sponding to 1 - 2% of the buildings’value.

Net reversals of previous write-downs amounted to SEK 10 m. (write-down: 55) during 2002. Write-downsor reversals of write-downs werebased on independent valuationsconducted by Svefa and ForumFastighetsekonomer.

Operating profit from completedproperties rose 23% to SEK 392 m.(320). Profit before depreciation,write-downs and reversals of previouswrite-downs rose by SEK 3 m. to SEK415 m. (412).

InvestmentsExcluding expensed costs, invest-ments in new and existing completedproperties during the year totaled SEK24 m. (21), of which tenant-orientedproperty improvements accounted forSEK 11 m. Most of the investmentswere made in Norrköping where, forexample, commercial space in theTulpanen 18 office building, and inthe Spiran 9 and Vinpipan 12 proper-ties was developed. Within theIndustrilandskapet area, investmentswere made in several properties in or-der to enable additional leasing. Inaddition, 13 student apartments werebuilt in the Asken 42 property.

Development propertiesLundbergs’ development propertiesconsist mainly of farmland and forest-land, mainly in central Sweden. TheGroup also has a number of sites incentral locations in central Sweden.

In total, the development proper-ties are represented by nearly 100 ob-jects covering a total area of about 31

million square meters. They have abook value of SEK 126 m. (133) andan estimated market value of SEK 183m. (184).

The purpose of property-develop-ment operations is to convert land re-quiring remediation or undevelopedland into sites suitable for commercialdevelopment, and to create new pro-jects. This is achieved through activeinvolvement in planning and propertyformation matters, and through coop-eration with the parties who needland suitable for construction.

Pending completion of the plan-ning process, the development hold-ings comprising farmland are leasedout and the forestland is utilized bysubcontractors.

Operating revenuesThe development properties yieldedtotal rental revenues of SEK 3 m. (3).

During 2002, sales of develop-ment properties totaled SEK 4 m. (10),providing a gain of SEK 0 m. (2). Thesold properties were mainly sites forresidential construction.

Property costsOperating expenses amounted to SEK1 m. (2) and the operating net to SEK2 m. (0).

Direct sales and administrativecosts amounted to SEK 1 m. (2).

During 2002, reversals of previouswrite-downs amounted to SEK 0.3 m.(write-down: 7). The reversals werebased on internal valuations.

Operating profit of SEK 1 m.(loss: 8) was reported.

Work in progress includes devel-opment planning for 100 single-fami-ly homes in Staffanstorp, a large hous-ing estate in Upplands Bro and single-family homes and other types of resi-dential areas in Strängnäs, Nacka,Enköping and Vallentuna, among oth-er municipalities. The largest develop-ment currently under way is at Ekeby-Almby, in Örebro Municipality, wheredevelopment work started in 1997and is expected to continue until2007. About 180 single-family homeswill be built in the area, of which some30 have already been completed.

Invest

At the end of 2002, the Invest business area had assets with a total market value ofSEK 11.3 billion. Lundbergs has major shareholdings in the publicly traded com-panies Cardo, Holmen, Hufvudstaden, Industrivärden and NCC, and in Stadium,an unlisted retail company.In addition to managing its major shareholdings, the business area has mediumand short-term portfolio investments.

Strategy and objectivesLundberg Invest’s business concept isto function as an active, long-termowner that manages and develops alimited number of investments inSwedish, mainly publicly traded,companies. The companies must beactive in industries in which the expe-rience and skills accumulated by theGroup can be utilized. These indus-tries are mainly construction and realestate, forest products and segmentsof the engineering and finance sectors.

The strategy pursued by Lundbergsin its role as an active and long-termowner is to contribute expertise andstability at the ownership level, whichcreates conditions in which the com-panies can conduct solid and prof-itable operations. Value is createdthrough long-term ownership respon-sibility and dedicated participation inwork on boards of directors.Lundbergs is represented, throughone or more members, on the boardsof directors of Cardo, Holmen,Hufvudstaden, NCC and Stadium.

In addition to the major, long-termshareholdings, the business areamakes medium and short-term portfo-lio investments. The medium-term in-vestments are mainly made on theSwedish stock market and Lundbergsdoes not function as an active ownerof the companies in this portfolio.Lundbergs invests in shares that areadjudged to have potential for favor-able value growth. The size of theseinvestments varies considerably overtime and is mainly dependent onmarket conditions and access to capi-tal within the Group. The investmenthorizon for medium-term investmentsis generally one or a few years.

Short-term investments in sharesand fixed-income instruments aremainly made through the subsidiary L E Lundberg Kapitalförvaltning. Theinvestment horizon for these invest-

ments is shorter than a year and nor-mally three to six months.

The ultimate objective is to gener-ate a high absolute return on investedcapital, meaning a long-term returnthat must substantially exceed theyield on a risk-free interest-bearinginvestment.

Structure of the stock portfolioLundbergs’ investments are concen-trated to a few major holdings. Thesemajor shareholdings accounted forSEK 11.1 billion of the Group’s totalinvestments in shares, which amount-ed to SEK 11.3 billion at the end of2002. Lundbergs’ major shareholdingsare Cardo, Holmen, Hufvudstaden,NCC, Stadium and the Industrivärdenholding acquired during 2002.

Lundbergs has been the principalowner of Cardo, a well-managedmultinational engineering companywith strong market positions, since1998. Over the years, Cardo hasshown a consistently high return oncapital employed, combined with theability to generate both organic andacquisition-based growth.

Lundbergs has had a major share-holding in Holmen since 1988 andhas been the company’s principalowner since 1993. Holmen, whichbecame a Lundberg subsidiary in2000, is a financially solid forestproducts company, with strong posi-tions in the European market forwood-containing printing papers andhigh-grade paperboard.

Hufvudstaden, which has been asubsidiary of Lundbergs since 1998,has real estate holdings that are con-centrated in the heart of inner-cityStockholm and Gothenburg.

Lundbergs has held a substantialownership interest in NCC since1997, when the company mergedwith Siab, in which Lundbergs wasthe principal shareholder. NCC has a

strong position in the Nordic con-struction market. In recent years,NCC has worked proactively to im-prove its profitability and consolidateits balance sheet.

Since 2001, Lundbergs has owned20% of the unlisted companyStadium, Sweden’s largest privatelyowned sports-products and sports-fashion chain. This high-growth com-pany aims to be the leading player inthe Nordic market by 2005.

During 2002, a major sharehold-ing was acquired in Industrivärden,an investment company with substan-tial holdings in a number of Sweden’sbest-managed companies. TheIndustrivärden investment also in-creases the diversity of Lundbergs’stock portfolio.

During recent years, the scope ofthe medium-term portfolio has beenlimited. The year-end market value ofthe Group’s medium-term invest-ments, which comprised a holding inVolvo, was SEK 121 m.

•19

NCC 6%Stadium 2%

Holmen41%

Hufvudstaden23%

Cardo 18%

Other 2%

Industrivärden8%

Distribution of Invest business area’s assets

Lundbergs´ major shareholdingsMarket

Voting Share valueDec 31, 2002 rights, % capital % SEK m.Cardo 34 34 2,018Holmen 52 28 4,648Hufvudstaden 88 44 2,544Industrivärden 6 5 872NCC 17 14 729Stadium 20 20 2501

Total 11,0611) Book value

•20

Continud, Invest

Investment activityDuring 2002, Lundbergs made majorinvestments in Industrivärden, whichamounted to 8.7 million Series Ashares at year-end, with a total acqui-sition value of SEK 936 m. Most of theIndustrivärden investment was con-ducted during the third and fourthquarters.

Lundbergs acquired 200,000Holmen shares during the year and si-multaneously issued call options witha corresponding underlying value tosenior Holmen executives. No otherpurchases or sales affecting the majorshareholdings were effected duringthe year. A total of 70,400 Lundbergshares were repurchased during 2002for SEK 12 m.

L E Lundberg Kapitalförvaltning ABL E Lundberg Kapitalförvaltning is awholly owned subsidiary that tradesin shares and other financial instru-ments. The objective of operations isto utilize macroeconomic and corpo-rate analyses in order to generate a fa-vorable return on capital employed.

In addition to securities trading, thecompany accounts for the analysisand follow-up of other investmentswithin the Invest business area.

The securities traded include equi-ties, bonds and derivatives of theseassets. Although shares listed onStockholmsbörsen account for mostof the investments, investments mayalso be made in other stock marketsin Europe and North America.

L E Lundberg Kapitalförvaltningreported an operating loss of SEK 41m. in 2002. The weak earnings weredue to the sharp stock-market declineexperienced during the year. Grossyear-end exposure amounted to SEK117 m. The operations continued todevelop during 2002 and, for exam-ple, one new employee was recruit-ed. The organization currently con-sists of five employees.

The year on the stock marketThe 2002 fiscal year was another yearin which the stock market suffered theconsequences of the wave of specula-tion that characterized the market

during the latter part of the 1990s.With the benefit of hindsight, we canconclude that the faith placed inshare investments during that periodwas excessive. As a result, companiesthat had access to “cheap” capital,not least in the high-tech sector, in-dulged in over-investment. Companypresidents with strong financial inter-ests went hunting for quarterly profitsusing what were occasionally ques-tionable methods. Even traditionallyconservative investors, such as pen-sion funds, increased the share of eq-uities in their portfolios to levels thatdid not take into account the risk ofnot being able to meet their obliga-tions. These imbalances have had tobe adjusted in recent years. Sharplyreduced profit expectations, account-ing scandals that came to light andenforced sale of shares had a consid-erable impact on stock-market perfor-mance in 2002.

The main conclusion we canmake when summing up the year onthe stock-market is that a large pro-portion of the world’s stock ex-changes declined during 2002. TheSwedish stock market has not experi-enced such a collapse in a single yearsince 1931. In terms of figures,Affärsvärlden’s General Index plum-meted by 37% in 2002, while thedrop noted between the market peakin March 2000 and the level at theend of 2002 was a full 63%.

2002 was the third consecutiveyear marked by a negative stock-mar-ket trend, a highly unusual occur-rence. The last time this happenedwas in connection with Sweden’sKreuger Crash, when the stock marketfell by 65% over a four-year period(1929-32).

Stockholmsbörsen was one of theexchanges that showed the weakestprice trend worldwide in 2002, andFrankfurt was the only one of the ma-

MAY

Index, USA

•21

jor stock exchanges to show a weakerperformance. In the US, the yearclosed with declines for the main in-dexes. Dow Jones Industrial Averagedropped by 17%, S & P 500 by 23%and NASDAQ by 32%.

During late 2001 and early 2002,many economic indicators pointedtowards an improvement. Hopes ofan economic recovery increased andexchange-listed companies were ex-pected to report significant profithikes. Meanwhile, it was becomingincreasingly evident that the Enronmatter was turning into one of themost serious accounting scandals inAmerican corporate history, resultingin eroded confidence in the stockmarket. Affärsvärlden’s General Indexclosed the first quarter at about thesame level as it entered it.

Increased pessimism about theeconomy, combined with escalatingconcern that the US economy wouldslump back into recession, as well asthe increasingly evident threat of awar in Iraq, were the main factors thatimpacted on stock-market perfor-mance in the second and third quar-ters. Profit forecasts were downgrad-ed repeatedly, while the unveiling ofnew accounting scandals in Americaadded fuel to the distrust towardsshares as an investment alternative.The stock-market trend pointedsharply downwards. Affärsvärlden’sGeneral Index lost 42% betweenApril and the end of September.Although stock markets made variousattempts to break the negative trend,each of these was brought to shameby gloomy economic messages andreduced profit forecasts. The negativestock-market trend forced Swedish in-surance companies to sell shares tomeet their statutory solvency require-ments, which exerted further down-ward pressure on prices during thethird quarter.

After the low point of 2002 wasreached in mid-October, stock mar-kets moved sharply upwards for twomonths, at the same time as a numberof economic indicators stabilized.During December, however, the neg-ative sentiment that had characterizedthe market during most of the year re-turned. Profit taking, escalating wor-ries about war and disappointmentabout weak Christmas trading figuresin the US led the stock market down-wards again. Another factor that hadan adverse impact on stock marketstowards the end of the year was theprice trend for oil. Oil prices rose25% from mid-November to year-end, due to such factors as the threatof war in Iraq and the strike among oilworkers in Venezuela. Affärsvärlden’sGeneral Index lost just over 13% inDecember 2002.

The stock market declined on abroad front during the year, with all ofAffärsvärlden’s 9 sector indexes losingground. The telecom index droppedthe most, plummeting by 67%, main-ly due to investment cutbacks amongtelecom operators and uncertainty re-garding the build-out of 3G. The in-dexes for Media/Entertainment and ITalso declined sharply, by about 65%.The sector indexes that fared bestwere Commodities and ConsumerProducts, which fell by only 6 and13%, respectively.

Share performance and dividendsThe year-end market value of thestock portfolio was SEK 11.3 billion.Adjusted for net investments, the val-ue declined by 4% during the year,compared with a drop of 37% forAffärsvärlden’s General Index.Dividends received during 2002 to-taled SEK 435 m. The total return –that is, the change in value includingdividends – of plus 1% was signifi-cantly better than the SIX Return

Index, which fell by 36% during theyear.

In terms of share prices, Lundbergs’major shareholdings showed a mixedperformance during the year. Cardoshares fared very well, rising by 28%,considerably better than the compa-rable index, Affärsvärlden’s index forIndustrial Conglomerates, whichdropped by 43%. Holmen shares de-clined by 11%, slightly worse thanthe 8% decline in Affärsvärlden’sForest Products Index. Hufvudstaden’sshare price rose 3%, whileAffärsvärlden’s Real Estate Index increased by 4%. Affärsvärlden’sConstruction and Civil EngineeringIndex dropped by 28%, while NCCshares fared slightly better, falling by24%. Most of Lundbergs’ Industrivärdenholding was acquired during the second half of the year, meaningwhen a large part of the stock-marketdownturn had already passed. Theprice of Industrivärden sharesdropped by 39% during the year,while the value of Lundbergs’ holdingdeclined by 7%. In total, dividends ofSEK 425 m. were received from themajor shareholdings.

The medium-term portfolio con-sisted solely of Volvo shares duringthe year. Volvo shares showed a nega-tive price trend, falling by 19%, whileAffärsvärlden’s Automotive index de-clined by 15%. Dividends receivedfrom Volvo amounted to SEK 8 m.

Dividends receivedMajor shareholdings

SEK m. 2002 2001Cardo 81 71Holmen 218 1,5031

Hufvudstaden 93 79Industrivärden 2 2NCC 31 63

Total 425 1,7181) Including an extraordinary dividend of SEK 1,307 m., or

SEK 60 per share.

Invoiced sales by business area

Invoiced sales by geographic area

Andel av affärsområdeInvests tillgångar

The Cardo share

Cardo18%

Cardo Pump36%

Cardo Door64%

North America 8%Asia 5%

Other 2%

Europe85%

Proportion of Invest business area’s assets

Afv Industrial Conglomerates IndexCardo

Kr

50

90

130

170

210

250

FebJan 03NovSeptJulyMayMarchJan 02

•23

CARDO

Significant events during the yearCardo is a multinational engineeringgroup with strong positions in themarkets for doors and pumps.Operations are divided into two busi-ness areas: Cardo Door and CardoPump. The Cardo Rail business areawas divested during the year. Cardo ismainly active in Europe, which ac-counts for 85% of total sales. TheCardo group, which has productionunits in 11 countries and sales unitsin 30 countries, has approximately6,500 employees, of whom 80%work outside Sweden.

Cardo Door’s operations are divid-ed into four segments: industrialdoors, service, docking equipmentand residential garage doors. Thebusiness area is one of the world’slargest suppliers of industrial doorsand Europe’s leading supplier ofdocking equipment. Products in thesesegments are marketed under suchbrands as Crawford and Hafa. CardoDoor is also one of Europe’s largestmanufacturers of residential garagedoors, which are marketed undersuch brands as Crawford, Hendersonand Normstahl. Cardo Door has builtup an extensive service organization,making it the market leader in the ser-vice segment of the door sector andthe only door company in Europe thatoffers a comprehensive service net-work.

Cardo Pump is one of Europe’slargest manufacturers of pumps, agi-tators and aerators, for use in the wa-ter-supply, sewage-treatment, indus-trial and HVAC sectors. As a result ofacquisitions and in-house product de-velopment, Cardo Pump has estab-lished one of the broadest productranges in the market during recentyears. Its products are marketed underthe ABS and Pumpex brands. Thebusiness area also includes Lorentzen& Wettre, a world-leading producer

of measuring equipment for the pulpand paper industry.

Cardo’s strategy is to further devel-op as an international engineeringgroup and as a leading supplier ofhigh-quality products and systemsthat have a solid after-market. The af-ter-market comprises sales of spareparts, as well as repairs, maintenanceand upgrading services. Cardo’s finan-cial objectives over a business cycleare profitable sales growth of 15% peryear, of which approximately half is tobe generated organically and the remainder through acquisitions, and areturn on capital employed exceeding20%. The board of directors’ aim is topropose that a dividend correspond-ing to 30–50% of net consolidatedprofit be paid to shareholders eachyear.

• Cardo enhanced its position in theUK market for industrial doorsthrough the acquisition of AmberDoors in January. The acquired com-pany, which has annual sales of SEK240 m. and 260 employees, is one ofthe UK’s largest producers of industri-al doors. The acquisition price wasSEK 220 m.

• Nopon Oy, a Finnish company thatis one of the world’s leading manu-facturers of aeration products for bio-logical sewage treatment, was alsoacquired in January. Nopon has an-nual sales of SEK 120 m. and 65 em-ployees. This acquisition supplementsCardo Pumps’ product range in thewater-supply and sewage-treatmentsegments.

• In July, Cardo concluded an agree-ment regarding the divestment of theRail business area to Vestar CapitalPartners. The transaction was final-ized during September. The salesprice of approximately SEK 2 billionfor a debt-free company generated atax-free capital gain of SEK 323 m.

• In August, Cardo Door received anorder from China for threeMegadoors. The order, Cardo’s largestto date in China, was worth nearlySEK 30 m. Cardo’s Megadoors are de-signed for extremely large openingsand can be manufactured in virtuallylimitless sizes.

• Cardo’s board has decided to pro-pose that the Annual General Meetingon April 7, 2003 approve an ordinarydividend of SEK 8 per share and an extraordinary dividend of SEK 32 pershare for 2002. The dividend proposalshould be viewed in the light of thesale of the Rail business area.

Key financial data1

2002 2001Net sales, SEK m. 8,401 8,071Profit after net financial

items, SEK m. 449 493Earnings/share after tax, SEK 10.38 12.16Dividend/share, SEK 40.002 8.00Share price, Dec. 31, SEK 202.00 158.001) Excluding Cardo Rail

2) Board of Directors’ proposal, including extraordinary dividend of SEK 32 per share.

Largest shareholders

% of share capital and voting rights

Lundbergs 33.5Tredje AP-fonden 8.7Nordea fonder 5.1SEB fonder 4.5Alecta 3.8

Lundbergs’ holdingDec 31, 2002

Number of shares 10,058,566Market value, SEK m. 2,0181) Including the effects of written options.

The Holmen share

External net sales by business area

External net sales by market

Proportion of Invest business area’s assets

Holmen41%

Holmen41%

Holmen Skog 13%

Iggesund Timber 4%

IggesundPaperboard

30%

Holmen Paper51%

Holmen Kraft 2%

Spain 8%

Rest of Europe 15%

Rest of world 10%

Sweden24%

UnitedKingdom

17%

Germany 12%

France 5%

Holland 5%

Italy 4%

FebJan 03NovSepJulMayMarchJan 02

SEK m.

Afv Forest Products index

•25

HOLMEN

Significant events during the yearHolmen is a specialist forest productsgroup with annual production capacityof 2.3 million tons of newsprint andmagazine paper and virgin-fiber-basedpaperboard. Europe is by far the compa-ny’s predominant market accounting forapproximately 90% of sales. TheHolmen group has about 5,100 em-ployees, of whom slightly more than20% work outside Sweden.

Holmen is organized in five busi-ness areas. Holmen Paper producesnewsprint and magazine paper at threeSwedish and one Spanish mill. Its prod-ucts are used mainly in the productionof newspapers, magazines, catalogs andadvertising materials.

Iggesund Paperboard produces vir-gin-fiber-based paperboard at twoSwedish and one UK mill. Its productsare used mainly for consumer packag-ing, as well as graphic-design applica-tions, such as book covers, postcardsand brochures.

By owning forest, power and paper-recycling companies, Holmen gainsknowledge of and control over key rawmaterials in terms of purchasing, price,availability and quality. IggesundTimber manufactures timber products ata sawmill in Sweden. Holmen Skog ac-counts for timber supply to the group’sSwedish units and manages the group’sholdings of approximately one millionhectares of productive forestland.Annual felling of forest assets amountsto 2.5 million cubic meters. HolmenKraft is responsible for the group’s hold-ings of hydroelectric power assets andelectricity supply to the group’s Swedishunits. Each year, approximately 1,100GWh of electrical power is generated atwholly owned or jointly owned hy-dropower plants in Sweden.

The group’s strategy is to focus ongrowth and development within theHolmen Paper and IggesundPaperboard business areas, which iswhere the company holds strong posi-tions in markets showing stable growth.The aim is to achieve growth in excess

of the market average. Attractive prod-ucts and product development create aplatform for growth, which will be gen-erated organically and through selectiveacquisitions. A focus on high qualityand low production costs in each prod-uct group gives Holmen a competitiveedge. R&D activities, which are guidedby customer requirements, focus mainlyon developing better products and moreefficient processes.

Holmen’s financial objective is toachieve a debt/equity multiple of0.5–0.7. The goal for ordinary dividendpayments corresponds to 5–7% of share-holders’ equity. Extraordinary dividendsand share repurchases may be effectedat times when this is permitted by thecompany’s business performance andcapital structure. Holmen aims to showfavorable profitability in the form of a re-turn that consistently and sustainably ex-ceeds the cost of capital in the market.

• In March, the Holmen Board decidedto invest SEK 75 m. in a new plant fortimber sorting at the Iggesund sawmill.

• In June, Holmen exercised its optionto repurchase 541 GWh of hydropowerin the Umeälv River for slightly morethan SEK 1.7 billion. The transaction became effective december 31th, 2002.

• In Hallstavik, Holmen’s new machinefor producing newspaper inserts, news-paper supplements and advertisingleaflets was inaugurated in September.This is the largest machine of its type inWestern Europe and the most modernmachine in the world for the productionof high-brightness MF magazine paper.The investment in the new machine andin an upgraded pulp and bleachingprocess cost a total of SEK 1.85 billion.

• The Holmen Board decided inFebruary 2003 to postpone until furthernotice the decision to build a newnewsprint machine at PapeleraPeninsular, the group’s Spanish mill. Themain reason for this is that thenewsprint market appears to be takinglonger than expected to recover. Thecompany will complete the pre-projectplanning process and intends to pur-chase the necessary land.

Key financial data

2002 2001Net sales, SEK m. 16,081 16,655Profit after net financial

items, SEK m. 2,564 2,294Earnings/share after tax, SEK 24.50 27.33Dividend/share, SEK 11.003 10.00Share price, Dec. 31,B-aktien 211.50 238.501) Figures for 2001 included negative items affectng comparability to

SEK 623 m. in 2001.2) Before dilution.3) Board of Directors´ proposal.

Largest shareholders

% of % ofshare voting

capital rights

Lundbergs 27.5 52.1Kempe foundations 6.4 16.6AMF Pensionsförsäkring AB 5.3 1.5Robur mutual funds 4.6 1.3Handelsbanken,

incl. pension foundation 3.1 8.7

Lundbergs’ holdingDecember 31, 2002

Series A shares 13,967,830 Series B shares 8,018,400 Market value1 , SEK m. 4,648 1) Including the effects of written options.

The Hufvudstaden share

Annual rental revenues by category

Annual rental revenues by business area

Proportion of Investbusiness area’s assets

Hufvudstaden23%

Gothenburg 10%

NK23%

Stockholm67%

Retail andrestaurants

32%

Offices60%

Other 8%

Afv Real Estate IndexHufvudstaden A

SEK m.

22

24

26

28

30

32

34

FebJan 03NovSeptJulMayMarchJan 02

Key financial data

2002 2001Revenues, SEK m. 1,348 1,260Profit after net financialitems, SEK m. 453 381Earnings/share after tax, SEK 1.60 2.29Dividend/share, SEK 1.101 1.00Share price, Dec. 31, SEK,Series A share 27.00 26.301) Board of Directors’ proposal.

Largest shareholders

% of % of share voting

capital rights

Lundbergs 44.2 87.6Skandia 14.8 3.0SEB Trygg Liv 11.5 2.4Investment AB Latour 3.5 0.7FörsäkringsbolagetPensionsgaranti 2.2 0.5

Lundbergs’ holdingDecember 31, 2002

Series A shares 85,141,229 Series B shares 8,177,680Market value, SEK m. 2,544

•27

HUFVUDSTADEN

Significant events during the yearHufvudstaden is one of Sweden’slargest real estate companies. Since itsestablishment in 1915, the companyhas owned and developed propertiessituated in attractive locations inStockholm’s inner city. Hufvudstadenis one of Sweden’s most focused andspecialized real estate companies,with properties concentrated in thevery heart of central Stockholm andGothenburg. The company’s businessconcept is to use its own properties incentral Stockholm and Gothenburg asa platform for offering high-quality of-fice and retail premises in attractivemarketplaces. Operations are dividedinto four business areas: StockholmEastern City, Stockholm Western City,NK and Gothenburg.

Stockholm Eastern City consists ofHufvudstaden’s properties east ofSveavägen, and in the Old Town andSödermalm, excluding the NK depart-ment store and the Parkaden parkingbuilding. The business area has a totalof 19 properties.

The Stockholm Western City busi-ness area consists of eight propertiesin the district west of Sveavägen.

The NK business area comprisesthe NK department stores inStockholm and Gothenburg, and thesubsidiary Parkaden. Although the NKdepartment stores are marketed exter-nally under a uniform trademark, NK,all of the stores are operated by pri-vate retailers. The aim is that NK de-partment stores will be perceived asworld-class marketplaces in terms ofproduct range, customer service, at-mosphere and function. Parkadenconducts parking operations in threeof Hufvudstaden’s properties.

The Gothenburg business areaconsists of four properties, all com-mercial. The largest property includesthe Femman department store, whichis part of the Nordstans shoppingmall. Retail premises account for

slightly more than half of total rentalrevenues.

Hufvudstaden’s customers arecompanies that attach a value to cen-trally located, high-quality premises.The tenant stock consists mainly oflaw firms, companies in the bank andfinancial sector, advertising and me-dia companies, management compa-nies and retail outlets. Biblioteksgatanand the NK department store on Hamn-gatan are by far the most exclusivelocations in Stockholm. Hufvudstaden iscurrently developing the Norrmalmstorg 1property, in order to further enhancethe attractiveness of the shopping districtbetween Biblioteksgatan and NK.

Hufvudstaden aims to maintain adividend level corresponding to morethan half of net profit from continuingoperations, unless the company’s in-vestments or financial position requirean alternative course of action. Anotheraim is to achieve an adjusted equity/as-sets ratio of at least 40% over time.

• The rent level for leases renegotiat-ed during the year rose by 32%.

• An extensive refurbishment of theNorrmalmstorg 1 property has beeninitiated with the objective of recreat-ing the building’s character as a lead-ing center for retail, finance and legalservices. Most of the project is sched-uled for completion around the endof 2003.

• A comprehensive remodeling of thelower floor of NK Stockholm was ini-tiated as planned at the beginning of2002. The aim is to improve accessi-bility and increase the range of stores.The entire remodeling project will becompleted during the first half of2003.

• Hufvudstaden and Danske Bankhave signed an 11-year lease for thetop story of Norrmalmstorg 1. Theleased space amounts to 7,500square meters. Occupancy is sched-uled for the end of 2003.

• NK Saluhallen, an indoor food mar-ket operated by the ICA supermarketchain, was opened at NK Hamngatanin September. The focus is on freshfood and pre-cooked meals.

• During the autumn, the Spanishfashion chain Zara signed a 12-yearlease for 1,600 square meters of floorspace in Norrmalmstorg 1.Occupancy is scheduled for autumn2003.

• The Hufvudstaden Board proposesthat the Annual General Meeting au-thorize the repurchase of up to 10%of Hufvudstaden’s own shares.

Construction Sweden 36%

Construction Denmark 12%Construction

Finland 10%

Construction Norway 9%

Construction Germany 2%Construction Poland 1%

International Projects 3%

Property Development 8%

Roads 17%

Altima 3%

Net sales by business area

The NCC share

Net sales by market

Proportion of Investbusiness area’s assets

NCC6%

Finland10%

Other 8%

Sweden49%

Denmark 19%

Norway 14%

Afv Construction IndexNCC B

SEK m.

40

45

50

55

60

65

70

75

80

85

FebJan 03NovSeptJulMayMarchJan 02

•29

NCC

Significant events during the yearNCC is one of the leading constructionand property-development companiesin the Nordic region. The companydevelops complete housing and prop-erty projects and constructs offices,industrial premises, housing, roads,civil engineering facilities andtelecommunications infrastructure. Italso produces raw materials used inconstruction operations, such as aggregates, asphalt and ready-mixedconcrete, and conducts paving androad-service operations.In selectedmarkets outside the Nordic region,the company engages in large-scale,technologically advanced civil engi-neering projects. NCC also special-izes in property development, mean-ing the identification, developmentand sale of real estate projects. A sub-sidiary, Altima, rents machinery andequipment to both NCC and externalcustomers.

NCC is organized in ten businessareas. NCC´s Construction and civilengineering operations are conductedby six geographically divided units, ofwhich NCC Construction Sweden isthe largest by far, followed by thethree other Nordic units, plusGermany and Poland.

NCC International Projects accountsfor all major Nordic and internationalcivil engineering projects. NCCProperty Development is responsiblefor NCC’s property-development operations. NCC Roads produces aggregates, asphalt and ready-mixedconcrete and conducts paving androad-marking activities. The group’smachinery rental operations are con-centrated in Altima.

According to a new strategy for-mulated in 2002, NCC will focus primarily on Nordic markets.Profitability will be assigned priorityahead of volume, while operationswill be concentrated towards the core

businesses. An increased emphasiswill be placed on adding value, expanding the responsibilities assumed by NCC and becoming moreactive in the customers’ value chain.The financial risk is to be reduced. Ina long-term perspective, growth is aprerequisite for stable profitability.

One of NCC’s financial objectivesis to achieve a return of 15% on equityafter taxes. Other aims are anequity/assets ratio of 30% and a posi-tive cash flow. The dividend target isto distribute approximately half of an-nual profits, after full tax, to share-holders.

• NCC implemented a comprehen-sive action program. Unprofitableunits were phased out and the numberof employees was reduced by approximately 2.500. The action pro-gram will generate its full effects during 2003. With the exception ofNCC Construction Norway, the action program proceeded as plannedwith earnings improvements achievedin several key areas.

• A decision was taken to sell all ofthe managed properties. During theyear, properties with a value of SEK3.0 billion were sold. The book valueof the remaining managed propertiesis about SEK 1.1 billion.

• The HVAC installation company,NVS, was sold during the year, for apurchase price of SEK 431 m.

• As a result of the sales of propertiesand companies, combined with theeffects of the action program, NCCreported a highly positive cash flowduring the year and reduced its netindebtedness from SEK 10.3 billion toSEK 5.8 billion.

• Within NCC Construction Norway,a new management team was ap-pointed, about two thirds of the com-pany’s former senior executives werereplaced and the administrativeworkforce was reduced by nearly onefourth.

• The NCC Board proposes that theAnnual General Meeting approve thespin-off of the subsidiary AltimaGroup AB to NCC shareholdersaround the end of 2003/2004.

Key financial ratios

2002 2001Net sales, SEK m. 45,165 47,5211

Profit/loss after net financial items, SEK m. 1,306 -2,130

Earnings/loss per share after tax, SEK 7.95 -21.60

Dividend/share, SEK 2.752 2.25Share price, Dec. 31,NCC B share, SEK 53.00 70.001) Pro forma.2) Board of Directors’ proposal. In addition to the cash dividend, a

spin-off of all of the shares in Altima is proposed, whereby each multiple of ten NCC AB shares will qualify for one share in Altima Group AB.

Largest shareholders

% of % of share voting

capital rightsNordstjernan AB 35.0 50.0Lundbergs 13.6 17.0Robur fonder 6.3 7.4Eikos fond 4.3 2.1Nordea fonder 2.7 1.0

Lundbergs’ holdingDecember 31, 2002

Series A shares 10,721,140Series B shares 3,242,860Market value, SEK m. 729

Net sales by business area

Net sales by region

Proportion of Invest business area’s assets

Stadium 2%

Sportswear 28%

Footwear 18%

Streetwear 11%

Junior 10%

Outdoor 10%

Team Sports 10%

Other 4%Action

4%

Golf 5%

Stockholm 27%

West13%

Central11%

North13%

East 13%

South10%

Other 13%

SEK m

1000

1400

1800

2200

2600

3000

02/03 Budget01/0200/0199/0098/99

Sales trend

•31

STADIUM

Significant events during the yearStadium is a high-growth sports andsports-fashion company that aims tobecome the Nordic market leader by2005. The company’s vision is to in-spire as many people as possible tohave an active, enjoyable and healthydaily lifestyle. The group comprises80 Stadium outlets, mainly in Swedenbut including four in Finland andthree in Denmark. In addition to theStadium outlets, the group includesNike Concept Stores, Red Devil,Edins, Sports Outlet, Sportlagret,Stadium Pro Concepts and StadiumPromotion.

A Stadium outlet is designed tofunction as an experiences arena,with the characteristic running trackson the floor and distinctive store en-trances, combined with the method ofdisplaying goods, forming the basisfor a successful new store concept.

Stadium is Sweden’s largest sports-product chain, with sales of aroundSEK 3 billion, excluding VAT. Thegroup has approximately 2,500 em-ployees and is headquartered inNorrköping. Stadium is a family busi-ness, with brothers Bo and Ulf Eklövas the principal owners. Lundbergsacquired a 20% interest in the com-pany during 2001. The aim is to listStadium shares on the stock exchangewithin about five years.

The company’s business conceptis to buy and sell products that offergood performance, design and qualityat prices that make them accessible tolarge numbers of people. The rangeincludes most types of products for an

active life, such as clothing, footwear,articles for team sports, golf equip-ment and skis. Stadium markets lead-ing branded products, such as Nike,Adidas, Salomon and Levi’s, as wellas its own brands, which includeEverest, Warp, 4D, Soc, Conquest,Competition and Deeone. Stadium’starget is to achieve total sales growthof at least 10% per year. During re-cent years, Stadium has shown totalsales growth of slightly more than20% per year.

• Eleven new Stadium stores wereopened during the year. In Sweden,new Stadium stores were opened atSödergatan and Jägersro in Malmö,Marieberg in Örebro, Bromma,Länna, Hallunda and Täby inStockholm, and Nova in Lund andHälla in Västerås. The company’s ex-pansion in other Nordic countriescontinued. In Finland, a store wasopened in Vanda, outside Helsinki,while the third store in Denmark wasopened in Glostrup, outsideCopenhagen. Sportlagret in Arninge,outside Stockholm, was another storeopened in 2002. In addition, two ma-jor remodelings were completed:Stadium in the Ikea Building,Uppsala, and Stadium in Skövde.

• During four intensive summerweeks, Stadium Sports Camp,Sweden’s largest sports camp for 11to 14 year olds, was held atHimmelstalund, Norrköping, for theeighth consecutive year. A total ofabout 3,000 young people participated.

• To meet Stadium’s future require-ments, considerable investmentswere made in a new business-supportsystem, and in a new logistics functionin Norrköping.

• To facilitate the sharp expansion inthe nordic region, the service officein Norrköping underwent compre-hensive refurbishment and expansionand a large number of new employ-ees were recruited, for both the ser-vice office and the stores. The aim isto increase the standard of serviceprovided in the stores and to furtherstrengthen market positions.

Sales trendexcluding VAT

SEK m.98/99 1,57899/00 1,79600/01 2,11901/02 2,57502/03 Budget 3,000

Shareholders% of share capital and voting rights

Ulf Eklöf and family 59.4Lundbergs 20.0Bo Eklöf and family 19.8Others 0.8

Report of the Board of Directors

The Board of Directors and President of L E Lundbergföretagen AB (publ) herebysubmit their Annual Report and financial statements for fiscal year 2002 for theParent Company and the Group.

The Group’s operations consist of the two business areas,Real Estate and Invest. The Real Estate business area com-prises Lundbergs’ own real estate operations. Invest in-cludes the holdings in the publicly traded companiesCardo, Holmen, Hufvudstaden, Industrivärden and NCC,and in the unlisted retail company Stadium, as well as themanagement of other assets.

In the opinion of the Board of Directors, analyses ofthe Group’s operations will benefit if the holdings inCardo, Holmen, Hufvudstaden, NCC and Stadium are re-ported from the viewpoint of cash flow and net asset val-ue. In order to provide a fair description of the Group’sprofits and financial position, the income statements, bal-ance sheets and key figures in this report are therefore pre-sented as if these companies were treated solely as share-holdings (other long-term holdings of securities), and thuswere not consolidated in the Group.

Financial statements based on full consolidation ofsubsidiaries and associated companies in accordance withthe Swedish Annual Accounts Act are presented in Note 1.

Sales and profitThe Group’s net sales amounted to SEK 1,631 m. (3,195).Profit after financial items amounted to SEK 652 m.(1,898). Profit after full tax was SEK 597 m. (1,986), whichcorresponds to SEK 9.62 (31.48) per share. Sales and profitfor 2001 were affected by an extraordinary dividend ofSEK 1,307 m. from Holmen and tax revenue of SEK 88 m.

Real EstateOperating profit for the Real Estate business area rose by27% to SEK 400 m. (315).

Rental revenues from housing and commercial premis-es, which increased by 4.2% to a total of SEK 814 m.(781), developed well, with housing revenues rising by2.7% to SEK 394 m. (383) and revenues from commercialpremises, etc. rising by 5.7% to SEK 420 m. (398).Housing accounted for 48% of total rental revenues andcommercial premises, etc. for 52%.

The average vacancy rate for the year was 2.6% (2.3),of which the vacancy rate for housing was 0.6% (0.9) andthe vacancy rate for commercial premises was 4.4% (3.6).The overall vacancy rate in February 2003 was 2.1%,whereby the rate for housing was 0.6% and that for com-mercial premises was 3.9%.

In total, properties were sold for SEK 4 m. (10), generat-ing pretax gains of 0 m. (2). Due to the adjustment of previ-ous capital gains, total gains amounted to SEK 3 m. (2).

Property costs before write-downs/reversals rose to SEK400 m. (315). The increase was due to higher maintenanceand tenant-oriented property improvement costs, whichtotaled SEK 123 m. (108).

The operating net amounted to SEK 488 m. (477).The Group’s properties were valued during the fourth

quarter. This resulted in a net reversal of SEK 10 m. of pre-vious write-downs (write-down: 62), which was creditedto earnings.

A net amount of SEK 24 m. (24) was invested in whollyor partly owned properties during the year.

The tax assessment value of all completed propertiesand properties held for future development was SEK 5,059m. (4,617).

The Group's completed properties, which have a bookvalue of SEK 2,643 m. (2,633), generated an annualizedyield (operating net in relation to book value) of 18.4%(18.1). The book value of properties held for future devel-opment was SEK 126 m. (133).

InvestThe Invest business area reported operating profit of SEK359 m. (1,687). Earnings were charged SEK 29 m. (31) forwrite-downs of portfolio investments.

Profit includes dividends of SEK 425 m. from majorshareholdings in publicly traded companies (1,716, in-cluding extraordinary dividend of 1,307).

The subsidiary L E Lundberg Kapitalförvaltning, whoseresults are reported in Invest’s earnings, reported an oper-ating loss of SEK 41 m. (loss: 1). After financial items, theloss amounted to SEK 45 m. (loss: 2). On December 31,2002, gross exposure to shares and interest-bearing paperamounted to approximately SEK 117 m. (203).

•33

OperatingBook value, net as a % of

Floor space Rental Opera- December 31, book value SEK m. thousand m2 revenues ting net 2002 (annualized yield)

Completed properties 1,009 811 486 2,643 18.4Properties held for

future development 11 3 2 126

Total 1,020 814 488 2,769

Major shareholdings in publicly traded companiesThe tables below show the voting rights, percentage share-holding, book value and market value of the Group’sshares. During the year additional options were issued tosenior executives in Holmen. To cover commitments relat-ed to these options, Holmen shares in an amount of SEK40 m. were purchased. Industrivärden shares (Series A) inan amount of SEK 892 m. were acquired in 2002 and ofSEK 126 m. during 2003, up to February 19. The percent-age shareholding and voting rights in NCC have been af-fected by NCC’s repurchase of its own shares and restamp-ing of shares.

Portfolio investmentsIn addition to the major shareholdings in publicly tradedcompanies reported above, the Group, excluding L ELundberg Kapitalförvaltning, owned publicly traded shareswith a book value of SEK 121 m. (176) and a market valueof SEK 121 m. (176) on December 31, 2002.

Other shareholdingsThe item Other shareholdings includes shares in the unlistedsport and sport-fashion company Stadium in an amount ofSEK 250 m. (250). Lundbergs’ share of the share capitaland voting rights is 20%.

Financial itemsFinancial items amounted to an expense of SEK 99 m. (ex-pense:96), of which net interest items accounted for an ex-pense of SEK 81 m. (expense:85) and write-downs ofshares for SEK 30 m (13).

Financial positionLiquid assets (excluding credit facilities) decreased by SEK67 m. to SEK 43 m. (110). Interest-bearing liabilities in-creased to SEK 2,449 m. (2,023). On December 31, 2002the average period of fixed interest was approximately 23months and the average interest rate was 4.4% (4.2).

The Group’s interest-bearing net debt increased to SEK2,386 m. (1,771) and the debt/equity ratio to 0.25 (0.19).The Group’s reported shareholders’ equity on December31, 2002 was SEK 9,675 m. (9,447). The equity/assets ratiodecreased to 76% (78).

Net asset valueOn December 31, 2002, net asset value1 per shareamounted to SEK 246 (247) and SEK 221 (220) after a de-duction for deferred tax2. Reported shareholders’ equityaccounted for SEK 156 (152) of net asset value per share.

On February 19, 2003, estimated net asset value pershare was SEK 240 and SEK 217 after deferred tax.

•34

Continued, Report of the Board of Directors

February 19, 2003 December 31, 2002 December 31, 2001Voting Share- Voting Share- Voting Share-

% rights holding rights holding rights holding

Cardo 33.5 33.5 33.5 33.5 33.5 33.5Holmen 52.1 27.5 52.1 27.5 52.0 27.2Hufvudstaden 87.6 44.2 87.6 44.2 87.6 44.2Industrivärden 7.1 5.2 6.2 4.5 0.3 0.2NCC 17.1 13.6 17.0 13.6 16.7 13.3

February 19, 2003 December 31, 2002 December 31, 2001Book Market Book Market Book Market

SEK m. value value1 Value value1 value value1

Cardo 1,890 1,884 1,890 2,018 1,890 1,589Holmen 2,587 4,492 2,587 4,648 2,547 5,153Hufvudstaden 2,828 2,527 2,828 2,544 2,828 2,485Industrivärden 1,054 991 928 872 43 56NCC 1,076 680 1,076 729 1,076 967Total 9,435 10,574 9,309 10,811 8,384 10,2501) Publicly traded assets are entered at current market price or at the exercise price for written options in the

event that the latter price is lower.

December 31, 2002 December 31, 2001SEK m. SEK/share SEK m. SEK/share

Real Estate 6,814 110 6,844 110Invest

Cardo 2,018 32 1,589 26Holmen 4,648 75 5,153 83Hufvudstaden 2,544 41 2,485 40Industrivärden 872 14 56 1NCC 729 12 967 15Stadium 250 4 250 4Other publicly traded shares 198 3 267 4

Other assets, provisions and liabilities -2,828 -45 -2,280 -36Net asset value before deferred tax 1 15,245 246 15,331 247Deferred tax 2 -1,553 -25 -1,666 -27Net asset value after deferred tax 13,692 221 13,665 220Market value 12,105 195 9,819 158Price/NAV, % 88 72

1) Net asset value has been computed as follows: Publicly traded assets are entered at current market price or at the exercise price for written options in the event that the latter price is lower. Properties are entered at the estimated market value on December 31, 2002, based on independent and internal valuations.Other assets, provisions and liabilities are entered at book value on December 31, 2001 and December 31,2002, respectively.

2) Deferred tax has been computed on the basis of the difference between the book and market value of properties and publicly traded shares. Other deferred tax is included in Other assets, provisions and liabilities.

•35

Repurchase of own sharesThe Annual General Meeting on April 4, 2002 approvedthe cancellation of the 6,146,900 Series B shares that hadpreviously been repurchased. The meeting also renewedthe Board’s authorization to repurchase up to 10% of thetotal number of shares in Lundbergs during the period upto the next Annual General Meeting 2003. The Board hasdecided to exercise the authorization received from theAnnual General Meeting, which will permit the repur-chase of up to 6,214,000 shares. As at December 31,2002, 70,400 shares had been repurchased for a total ofSEK 12 m., or an average of SEK 178 per share. The repur-chased shares correspond to 0.11% of the share capitaland 0.03% of the voting rights. No additional shares wererepurchased during the period up to and includingFebruary 20, 2003.

The average number of shares outstanding during theyear was 62,087,620. The number of shares outstandingon December 31, 2002 was 62,075,083.

The Board proposes that the Annual General Meetingauthorize the Board to repurchase Series B Lundbergshares during the period up to the 2004 Annual GeneralMeeting, subject to the limit that the Company’s holdingmay not exceed 10% of the total number of Lundbergshares at any point in time. The shares must be purchasedon Stockholmsbörsen during one or several occasions. Themarket price applying at the date of acquisition must bepaid for the shares. The reason for the repurchase autho-rization is to enable the Board to adjust the Company’scapital structure.

Parent CompanyL E Lundbergföretagen AB (publ) reported net sales of SEK370 m. (1,647) and profit of SEK 211 m. (2,501) after taxes.

Board of Directors and procedures for Board WorkLundbergs’ Board of Directors consists of seven memberselected by the Annual General Meeting plus two employeerepresentatives, with an equal number of deputies. Thoseelected by the Annual General Meeting include represen-tatives of the majority owner and external members.

Company executives participate in Board meetings topresent information. Six meetings were held during the2002 fiscal year.

Anticipated trend in 2003As a result of the proposed increases in dividends from ourshareholdings, including an extraordinary dividend of

about SEK 322 m. from Cardo, the Invest business area isexpected to show a significant increase in earnings in2003. Earnings from the Real Estate business area are ex-pected to remain at the same level as in 2002.

•36

Income Statements

Group Parent CompanySEK m. 2002 2001 2002 2001

REAL ESTATEOperating revenues

Rental revenues, etc. 814 781 Sales of properties - 0 2 Other revenues, net 4 2

Note 3 819 785 – –

Property expensesOperating expenses - 166 - 163 Property tax - 37 - 33 Maintenance and tenant-oriented property improvements - 123 - 108 Direct sales and administrative costs, etc. - 41 - 42 Depreciation Note 4 - 32 - 37 Write-downs 10 - 62

- 390 - 445 – –

GROSS PROFIT, REAL ESTATE 428 340 – –

Central administrative costs, etc. Note 4 - 31 - 25 Items affecting comparability Note 5 3 3

OPERATING PROFIT, REAL ESTATE 400 315 3 –

INVESTOperating revenues Note 6

Dividends 433 1,726 339 1,647 Loss on securities - 57 - 22 - 25 - 31

Operating expenses Note 4 - 16 - 17 - 9 - 10

OPERATING PROFIT, INVEST 359 1,687 305 1,606

Central administrative costs, etc. Note 4 - 8 - 8 - 8 - 7

OPERATING PROFIT Note 2 751 1,994 300 1,599

RESULTS FROM FINANCIAL ITEMSResult from participations in Group companies (dividends) 2 570Result from other securities and receivables

classed as fixed assets Note 8 - 18 - 11 - 19 - 12 Interest income and similar income statement items Note 9 17 17 37 37 Interest expense and similar income statement items Note 10 - 98 - 102 - 36 - 53

PROFIT AFTER FINANCIAL ITEMS 652 1,898 285 2,141

Appropriations Note 11 - 2 75

PROFIT BEFORE TAXES 652 1,898 283 2,216

Taxes Note 12 - 55 88 - 85 170

NET PROFIT FOR THE YEAR Note 1 597 1,986 198 2,386

EARNINGS PER SHARE 9.62 31.48 3.39 39.63

•37

Cash Flow Statements

Group Parent CompanySEK m. 2002 2001 2002 2001

CASH FLOW, OPERATIONSProfit from Real Estate, excl. depreciation,

write-downs and sales of properties 420 414Sales of properties 7 10 3Profit from Invest, excl. depreciation and gains on shares1 395 1,717 310 1,637 Financial items 1, 2 - 91 - 85 - 31 - 27 Change in current receivables 132 - 2 47 - 45 Change in current liabilities 525 - 312 587 350

CASH FLOW FROM OPERATIONS 1,387 1,742 917 1,915

CASH FLOW, INVESTMENT ACTIVITIESCompleted properties - 27 - 16Machinery and equipment - 47 - 3 - 0 0Sales of shares and participations 52 52Purchases of shares and participations - 934 - 369 - 934 - 303 Long-term receivables - 9 8 0 5

CASH FLOW FROM INVESTMENT ACTIVITIES - 965 - 380 - 882 - 298

CASH FLOW, FINANCING ACTIVITIESIntra-Group transactions 259 - 670 Financial investments - 48 - 13Loans against security in properties 1,000 - 1,956 Other loans - 1,072 1,535 - 2 0Purchases of shares and participations - 13 - 493 - 13 - 493Dividends to shareholders - 357 - 333 - 357 - 333

CASH FLOW FROM FINANCING ACTIVITIES - 489 - 1,260 - 113 - 1,496

CHANGE IN CASH AND BANK BALANCES DURING THE YEAR - 67 102 - 77 121

Cash and bank balances on January 1 110 8 121 0 Cash and bank balances on December 31 43 110 44 121

1) Dividends received amounted to SEK 433 m. (1,732) for the Group and SEK 339 m. (1,652) for the Parent Company.2) Interest paid totaled SEK 71 m. (99) for the Group and SEK 32 m. (33) for the Parent Company. Interest received

totaled SEK 14 m. (16) for the Group and SEK 34 m. (26) for the Parent Company

•38

Balance Sheets

Group Parent CompanyASSETS SEK m. Dec 31, 2002 Dec 31, 2001 Dec 31, 2002 Dec 31, 2001

FIXED ASSETS

Tangible fixed assets Note 14Buildings and land 2,633 2,630 Real estate equipment 9 3Machinery and equipment 54 10 2 2

2,696 2,643 2 2 Financial fixed assetsParticipations in Group companies Note 15 1,334 1,334 Other long-term holdings of securities Note 17 9,726 8 ,893 6,887 6,048 Other long-term receivables Note 18 6 14 24 15

9,732 8,907 8,244 7,397

TOTAL FIXED ASSETS 12,428 11,550 8,246 7,399

CURRENT ASSETS

Properties classified as current assetsDevelopment properties Note 19 126 133

126 133 – – InventoriesSecurities Note 20 77 86

77 86 – –

Current receivablesRent and accounts receivable 22 23 0 1 Receivables from Group companies 906 1,019Tax receivable 17 16 134Other receivables 17 112 4 7 Prepaid expenses and accrued income Note 21 24 26 1 10

79 161 928 1,171

Short-term investments 44 121

Cash and bank balances Note 22 64 197 0 0

TOTAL CURRENT ASSETS 346 577 972 1,292

TOTAL ASSETS Note 1 12,774 12,127 9,219 8,691

PLEDGED COLLATERALProperty mortgages 2,056 65Bank accounts 21 88

2,077 153 – –

•39

Group Parent CompanySHAREHOLDERS’ EQUITY AND LIABILITIES SEK m. Dec 31, 2002 Dec 31, 2001 Dec 31, 2002 Dec 31, 2001

SHAREHOLDERS’ EQUITY Note 23

Restricted equityShare capital (62,145,483 shares) 621 683 621 683 Restricted reserves 808 690 344 282

1,430 1,373 965 965 Unrestricted equityUnrestricted reserves 7,648 6,088 6,544 4,515 Reported net profit for the year 597 1,986 198 2,386

8,245 8,074 6,743 6,901

TOTAL EQUITY 9,675 9,447 7,708 7,866

Minority interest 0 0

Untaxed reservesAccumulated depreciation in excess of plan Note 24 0 0 Tax allocation reserve Note 25 450 448

– – 450 448 ProvisionsProvisions for deferred tax Note 26 371 370 Other provisions Note 27 46 51

417 421 – – Long-term liabilitiesLiabilities to credit institutions Note 28 1,042 42 Other liabilities Note 29 9 20 0 18

1,050 62 0 18 Current liabilitiesLiabilities to credit institutions Note 28 0 45 Accounts payable 26 37 1 0 Liabilities to Group companies 224 100 Tax liabilities 41 68 25Other liabilities Note 29 1,423 1,997 764 230 Accrued costs and prepaid income Note 31 142 118 5 4

1,631 2,197 1,061 359

TOTAL EQUITY AND LIABILITIES Note 1 12,774 12,127 9,219 8,691

CONTINGENT LIABILITIESContingent liabilities on behalf of subsidiaries 1,100 1,650 Contingent liability as partner with

unlimited liability Note 30 93 93Contingent liabilities as general partner 131 129 Capital value of pension commitments exceeding the

amount reported among “Liabilities” 1 0

225 129 1,193 1,650

•40

Notes

Note 1 - Complete consolidated financial statements, with Hufvudstaden,Holmen and publicly traded associated companies consolidated in accordance with the Annual Accounts Act (AAA).

Parent Company Group accordingINCOME STATEMENTS according to AAA to AAASEK m. 2002 2001 2002 2001

REAL ESTATEOperating revenues, etc. Note 3 2,167 2,044 Operating expenses Note 4 - 439 - 429 Property tax - 167 - 136 Maintenance and tenant-

oriented property improvements - 265 - 263Direct sales and administrative costs - 94 - 101 Depreciation Note 4 - 136 - 135 Write-downs 10 - 62

GROSS PROFIT, REAL ESTATE – – 1,076 918

Central administrative costs, etc. Note 4 - 67 - 55 Items affecting comparability Note 5 3 29 18

OPERATING PROFIT, REAL ESTATE 3 – 1,038 881

INVESTOperating revenues Note 6

Dividends 10 10 10 10 Loss on securities - 25 - 31 - 57 - 22

Operating expenses Note 4 - 9 - 9 - 16 - 17 Result from participations

in Group companies Note 7 218 1,503 Result from other participations in

associated companies Note 7 112 133 398 - 123

OPERATING PROFIT/LOSS, INVEST 305 1,606 334 - 152

HOLMENNet sales 16,081 16,655 Other operating expenses 497 407 Raw materials, goods for

resale and consumables - 7,112 - 7,223 Change in inventories of finished products - 56 138 Personnel expenses - 2,346 - 2,351 Other external expenses - 3,188 - 3,431 Depreciation Note 4 - 1,187 - 1,159 Write-downs - 620 Result from participations in

associated companies Note 7 - 10 - 3

OPERATING PROFIT, HOLMEN – – 2,679 2,413

Central administrative costs, etc. Note 4 - 8 - 7 - 8 - 8 Items affecting comparability Note 5 - 2 1

OPERATING PROFIT Note 2 300 1,599 4,041 3,135

RESULT FROM FINANCIAL ITEMSResult from participations in Group

companies (dividends) 2 570 Result from other securities and

receivables classed as fixed assets Note 8 - 19 - 12 - 18 - 12 Interest income and similar income

statement items Note 9 37 37 56 87 Interest expense and similar income

statement items Note 10 - 36 - 53 - 474 - 515

PROFIT AFTER FINANCIAL ITEMS 285 2,141 3,606 2,695

Appropriations Note 11 - 2 75

PROFIT BEFORE TAXES 283 2,216 3,606 2,695

Taxes Note 12 - 85 170 - 893 - 4 Minority share in net profit for the year - 1,613 - 1,862

NET PROFIT FOR THE YEAR 198 2,386 1,100 829

EARNINGS PER SHARE 3.39 39.63 17.72 13.13

Parent Company Group accordingCASH FLOW STATEMENTS according to AAA to AAASEK m. 2002 2001 2002 2001

CASH FLOW, OPERATIONSProfit from Real Estate, excl. depreciation,

write-downs and sales of properties 1,146 1,059 Sales of properties 3 7 29 Profit from Invest, excl. depreciation and

gains on shares 1 310 1,637 84 1 Profit from Holmen, excl. depreciation 3,957 4,192 Financial items 1, 2 15 - 27 - 368 - 430 Taxes paid - 45 - 566 - 52 Change in current receivables 47 - 45 225 1,849 Change in current liabilities 587 350 - 445 1,793

CASH FLOW FROM OPERATIONS 917 1,915 4,040 8,441

CASH FLOW, INVESTMENT ACTIVITIESBuildings and land - 72 - 690 Properties classified as current assets - 18 - 56 Machinery and equipment - 0 0 - 2,047 - 1,287 Sales of shares and participations 52 52Purchases of shares and participations - 934 - 303 - 2,372 - 284 Long-term receivables 0 5 - 13 10

CASH FLOW FROM INVESTMENT ACTIVITIES - 882 - 298 - 4,470 - 2,307

CASH FLOW, FINANCING ACTIVITIESIntra-Group transactions 259 - 670Financial investments - 33 - 95 Loans against security in properties 1,190 - 2,171 Other loans - 1,050 1,090 Long-term liabilities - 2 1,317Purchases of shares and participations - 13 - 493 - 13 - 493 Dividends to shareholders - 357 - 333 - 357 - 333 Minority interest - 740 - 3,916 Change in Group composition 0 - 31

CASH FLOW FROM FINANCING ACTIVITIES - 112 - 1,496 315 - 5,949

CHANGE IN CASH AND BANK BALANCES DURING THE YEAR - 77 121 - 115 185

Cash and bank balances on January 1 121 0 643 458 Cash and bank balances on December 31 44 121 528 643

1) Dividends received amounted to SEK 339 m. (1,652) for the Parent Company and SEK 121 m. (170) for the Group.

2) Interest paid totaled SEK 32 m. (33) for the Parent Company and SEK 452 m. (476) for the Group. Interest received totaled SEK 34 m. (26) for the Parent Company and SEK 53 m. (57) for the Group.

Parent Company Group accordingaccording to AAA to AAA

BALANCE SHEETS Dec 31, Dec 31, Dec 31, Dec 31,SEK m. 2002 2001 2002 2001

ASSETS

Fixed assets

Intangible fixed assetsGoodwill, rental rights and

similar rights Note 13 619 707– – 619 707

Tangible fixed assets Note 14 Buildings and land 22,737 22,243 Construction, extensions and

refurbishment in progress 248 932 Real estate equipment 229 198 Machinery and equipment 2 2 9,898 8,851

2 2 33,113 32,224 Financial fixed assetsParticipations in Group companies Note 15 3,921 3,881 Participations in associated

companies Note 16 3,216 3,216 5,133 3,604 Other long-term holdings

of securities Note 17 1,083 285 1,181 390 Other long-term receivables Note 18 24 15 215 272

8,244 7,397 6,529 4,265

TOTAL FIXED ASSETS 8,246 7,399 40,262 37,196

Current assets

Properties classified as current assetsDevelopment properties Note 19 126 133

– – 126 133 Inventories, etc.Raw materials and supplies, etc. Note 20 2,321 2,466

– – 2,321 2,466 Current receivablesRent and accounts receivable 0 1 2,325 2,584 Receivables from Group companies 906 1,019 Receivables from associated companies 133 Other receivables 20 141 408 379 Prepaid expenses and

accrued income Note 21 1 10 163 159 928 1,171 2,896 3,255

Short-term investments 306 91

Cash and bank balances Note 22 44 121 528 643

TOTAL CURRENT ASSETS 972 1,292 6,177 6,589

TOTAL ASSETS 9,219 8,691 46,439 43,785

PLEDGED COLLATERALProperty mortgages 3,889 2,107 Pledged securities 21 88 Other long-term receivables 1,610 46

– – 5,519 2,241

Parent Company Group accordingaccording to AAA to AAA

BALANCE SHEETS Dec 31, Dec 31, Dec 31, Dec 31,SEK m. 2002 2001 2002 2001

SHAREHOLDERS’ EQUITY AND LIABILITIES

Shareholders’ equity Note 23Restricted equityShare capital (62,145,483 shares) 621 683 621 683 Equity participation reserve 283 191 Restricted reserves 344 282 808 689

965 965 1,713 1,563 Unrestricted equityUnrestricted reserves 6,544 4,515 8,967 8,770 Reported net profit for the year 198 2,386 1,100 829

6,743 6,901 10,067 9,599

TOTAL EQUITY 7,708 7,866 11,780 11,162

Minority interest 13,717 12,844

Untaxed reservesAccumulated depreciation in

excess of plan Note 24 0 0 Tax allocation reserve Note 25 450 448

450 448 – –ProvisionsProvisions for deferred tax Note 26 6,337 5,847 Other provisions Note 27 496 662

– – 6,832 6,509 Long-term liabilitiesLiabilities to credit institutions Note 28 6,052 3,511 Other liabilities Note 29 0 18 403 407

0 18 6,456 3,918 Current liabilitiesLiabilities to credit institutions Note 28 951 1,479 Accounts payable 1 0 1,581 1,500 Liabilities to Group companies 224 100 Liabilities to associated companies 27 230 Tax liabilities 68 25 407 508 Other liabilities Note 29 764 230 3,602 4,671 Accrued costs and

prepaid income Note 31 5 4 1,085 964 1,061 359 7,655 9,352

TOTAL EQUITY AND LIABILITIES 9,219 8,691 46,439 43,785

CONTINGENT LIABILITIESContingent liabilities on

behalf of subsidiaries 1,100 1,650 Liability as partner with unlimited liability 131 129 Capital value of pension commitments

exceeding the amount reported among “Liabilities” 392 0

Guarantees and other contingent liabilities Note 30 93 1,023 467

1,193 1,650 1,546 596

•41

•42

Continued, Notes

Note 2 - Employees and personnel costs, SEK m.

of whom of whomAverage number of employees 2002 men (%) 2001 men (%)

Parent CompanySweden 5 76 6 76

Total in Parent Company 5 76 6 76

Wholly owned subsidiaries 206 70 206 69

Total in Parent Company and wholly owned subsidiaries 211 70 212 69

Hufvudstaden 133 47 141 51Holmen 5,075 83 5,238 83

Other subsidiaries, total 5,208 82 5,379 83

Group total, according to Annual Accounts Act 5,419 82 5,591 83

2002 2001Wages, salaries Wages, salaries

Wages, salaries and remuneration, and other Social sec- and other Social sec-and social security costs remuneration urity costs remuneration urity costs

Parent Company 4.9 2.7 4.8 3.1 of which, pension costs 1 0.8 1.3

Wholly owned subsidiaries 63.5 31.3 60.7 31.3 of which, pension costs 7.9 9.2

Total in Parent Company and wholly owned subsidiaries 68.4 34.0 65.5 34.4

of which, pension costs 2 8.7 10.5

Hufvudstaden 49.9 24.1 49.0 21.4 of which, pension costs 5.8 3.1

Holmen 1,705.0 641.0 1,713.0 638.0 of which, pension costs 173.0 189.0

Total in other subsidiaries 1,754.9 665.1 1,762.0 659.4 of which, pension costs 178.8 192.1

Group total, according to Annual Accounts Act 1,823.3 699.1 1,827.5 693.8

of which, pension costs 2 187.5 202.6

Wages, salaries and remuneration 2002 2001by country and distributed among Board of Dir- Board of Dir-Board of Directors and President ectors and Other ectors and Otherand other employees president employees president employees

Parent CompanySweden 2.9 2.0 2.6 2.1

Total in Parent Company 2.9 2.0 2.6 2.1

Wholly owned subsidiaries 4.2 59.3 4.3 56.5

Total in Parent Company and wholly owned subsidiaries 7.1 61.3 6.9 58.6

Hufvudstaden 3.4 46.5 3.1 45.9 Holmen

Sweden 3 15.0 1,295.0 26.0 1,261.0 Rest of Nordic region 1.0 1.0 1.0 1.0 Eastern Europe 1.0 2.0 3.0 Rest of Europe 18.0 356.0 23.0 385.0 Other countries 3.0 13.0 3.0 10.0

Group total, according to Annual Accounts Act 48.5 1,774.8 63.0 1,764.5

1) The Board of Directors/President category accounts for SEK 0.5 m. (1.3) of the Parent Company’s pension costs.2) The Board of Directors/President category accounts for SEK 13.3 m. (16.2) of the Group’s pension costs.The

Group’s outstanding pension obligations regarding these pension costs amounts to SEK 4.0 m. (3.7).3) The amount for 2001 includes a provision of SEK 11.8 m. for the cost of salary payments during period of notice

and severance pay for a former president.

In addition to the above information regarding remuneration, wages and salaries paid during2002, the following information pertaining to remuneration and benefits paid to senior execu-tives is provided in accordance with the recommendation from Sweden’s Industry andCommerce Stock Exchange Committee.

Parent Company and wholly owned subsidiariesThe Chairman of the Board of the Parent Company received a total of SEK 0.3 m. (0.2) in direc-tor fees. Other director fees amounted to SEK 0.6 m. (0.6). The President, who is also a memberof the Parent Company Board of Directors, was paid SEK 1.5 m. (1.5) and executive vice presi-dents in the Parent Company and subsidiaries were paid SEK 4.6 m. (4.6). Special remunerationof SEK 0.6 m. (0.6) was paid to the Chairman of the Parent Company Board for consulting ser-vices unrelated to his assignment as a Board member.

No particular agreements have been concluded in regard to severance pay or pension com-mitments. The president and vice presidents of a subsidiary received bonus payments of SEK0.3 m. (0.5) in 2002. An equal-status system is applied in Group companies whereby payrollcosts and payroll overheads are distributed among the Group companies concerned in relationto the time booked for projects and work performance.

The chairman of the board and one member of the board have been delegated by the boardof directors to conduct negotiations and reach an agreement with the president regarding hisremuneration and to then report back to the board. The president negotiates with other seniorexecutives regarding their remuneration.

HufvudstadenThe Chairman of the Board received SEK 0.2 m. in 2002 (0.2). Other Board members who arenot employed by Hufvudstaden received a total of SEK 0.7 m. (0.7).

Hufvudstaden’s President received total remuneration of SEK 2.3 m. in 2002, of which a bo-nus accounted for SEK 0.1 m. Remuneration and benefits received by other senior executivestotaled SEK 4.5 m., including bonus payments of SEK 0.3 m.

In the case of notice of termination by the company, the President is entitled to a term ofnotice of two years. In the case of resignation by the President, a term of notice of six monthsapplies. In both instances, any remuneration from a new employer will be deducted. In all signi-ficant respects, the pension schemes for the President and other senior executives are based oncustomary ITP pension plans. Other senior executives are entitled to a term of notice of oneyear if their employment is terminated by the company, or of six months if they resign. In bothinstances, any remuneration from a new employer will be deducted.

The Chairman of the Board has been delegated by the Board to conduct negotiations withthe President and agree on his remuneration and to then report back to the Board. ThePresident has been delegated by the Board to conduct negotiations with other senior executi-ves and agree on their remuneration and to then report back to the Chairman of the Board.

HolmenThe Chairman of the Board received remuneration of SEK 0.4 m. in 2002 (0.3). The Presidentreceived salary and other remuneration of SEK 5.7 m.

The period of notice is 12 months if employment is terminated by the company, and sixmonths if terminated by the President. Under an agreement with the President regarding a fu-ture pension, the retirement age has been set at 65, with each party having the right to effec-tuate the pension but not earlier than when the President turns 64. Pension is payable at a rateof 60% of salary up to age 65 and thereafter in an amount corresponding to customary ITPpension plans, complemented by a certain amount of retirement and family-pension incrementscovering the portion of salary corresponding to between 20 and 50 base amounts.

In the past, the Board assigned the Chairman of the Board to conclude agreements with thePresident regarding his salary and other employment terms. As of 2003, the Board has decidedthat the Chairman will prepare such matters and then present them to the Board for a decision.

Salary and other remuneration paid to business area presidents and heads of staff amoun-ted to SEK 16.6 m.

The period of notice for business area presidents and heads of staff is 12 months if employ-ment is terminated by the company, and six months if terminated by the executive. If the termi-nation notice is served by the company, severance payment ranging from 1.0 to 2.5 annual sa-laries could be payable, depending on age.

Under agreements with the said executives regarding future pensions, the retirement agehas been set at 65, with a mutual right to effectuate the pension after age 60. Pension payablebetween age 60 and 65 corresponds to 65% of pensionable salary up to 30 base amounts and32.5% between 30 and 50 base amounts. The executives’ regular pension schemes followcustomary ITP pension plans or the equivalent. In addition, supplementary pension benefits arepaid for the portion of salary corresponding to between 20 and 50 base amounts.

Fees and other compensation to auditors, SEK m.

Group accordingGroup Parent Company to AAA

2002 2001 2002 2001 2002 2001Auditing assignments 0.7 0.7 0.2 0.2 7.3 6.7 Other assignments 1.2 0.9 1.0 0.7 7.3 9.4

1.9 1.6 1.3 0.9 14.6 16.1

•43

Note 3 - Net sales, Real Estate, SEK m.

Group Group according to AAA

2002 2001 2002 2001Rental revenues, etc. 813 779 2,161 2,039 Interest subsidies 2 2 2 2 Sales, properties classified as current

assets and participations, revenues 4 10 4 10 Other revenues 34 24 34 24

852 815 2,200 2,074

Note 4 - Depreciation/amortization, SEK m.

Group accordingGroup Parent Company to AAA

2002 2001 2002 2001 2002 2001Depreciation/amortizationaccording to plan by type of assetGoodwill, rental rights

and similar rights - 67 - 69 Buildings and land - 29 - 30 - 239 - 231 Real estate equipment - 2 - 5 - 19 - 18 Machinery and equipment - 4 - 4 - 0 - 0 - 1,003 - 982

- 34 - 39 - 0 - 0 - 1,328 - 1,300

Depreciation/amortization according to plan by type of operation and functionReal Estate

Operating expenses - 4 - 5Depreciation - 33 - 37 - 136 - 135 Central administrative costs - 1 - 1 - 1 - 1

InvestOperating expenses - 0 - 0 - 0 - 0

HolmenDepreciation - 1,187 - 1,159

Central administrative costs - 0 - 1 - 0 - 0 - 0 - 1

- 34 - 39 - 0 - 0 - 1,328 - 1,300

Note 5 - Items affecting comparability, SEK m.

Group accordingGroup Parent Company to AAA

2002 2001 2002 2001 2002 2001

Capital gains, properties 3 3 3 18Dividends, Alecta 26Other - 2 1

3 – 3 – 27 19

Note 6 - Net sales, Invest, SEK m.

Parent Company GroupGroup Parent Company according to AAA according to AAA2002 2001 2002 2001

Dividends, major shareholdings 423 1,716 330 1,637

Other dividends 12 10 10 10 10 10 12 10 Sales of securities, etc. 344 654 31 31 344 654

779 2,380 370 1,647 40 10 356 664

Note 7 - Results from participations in Group and associated companies, SEK m.

Parent Company Group according to AAA according to AAA2002 2001 2002 2001

Group companiesHolmen AB (publ) Dividends received 218 1,503

218 1,503 – –Associated companiesCardo AB (publ) Dividends received 80 70

Participation in profit 286 220 Amortization of goodwill - 59 - 59

80 70 227 161

NCC AB (publ) Dividends received 31 63 Participation in profit 172 - 286

31 63 172 - 286

Stadium AB (publ) Dividends received 9 4 Participation in profit - 9 - 2

– – - 1 2

Indirectly owned associated companies Participation in profit - 10 - 3

330 1,636 388 - 127

Note 8 - Results from other securities and receivables classified as fixed assets , SEK m.

Group accordingGroup Parent Company to AAA

2002 2001 2002 2001 2002 2001Dividends 6 6 6 Capital gains 11 1 12 1 11 1 Write-downs - 30 - 17 - 30 - 17 - 30 - 17 Leasing revenues 1 1 1 1 Other - 2 - 0 - 2 - 2

- 18 - 11 - 19 - 12 - 18 - 12

Note 9 - Interest income and similar income statement items, SEK m.

Group accordingGroup Parent Company to AAA

2002 2001 2002 2001 2002 2001Interest income, Group companies 24 24 Interest income, others 14 16 10 13 50 84 Other 3 1 3 6 3

17 17 37 37 56 87

Note 10 - Interest expense and similar income statement items, SEK m.

Group accordingGroup Parent Company to AAA

2002 2001 2002 2001 2002 2001Interest expense, Group companies - 2 - 5Interest expense, others - 76 - 74 - 33 - 25 - 245 - 273Interest expense, property loans - 16 - 25 - 222 - 238Other - 7 - 3 - 2 - 23 - 7 - 3

- 98 - 102 - 36 - 53 - 474 - 515

•44

Note 11 - Appropriations, SEK m.

GroupGroup Parent Company according to AAA

2002 2001 2002 2001 2002 2001Difference between book

depreciation and deprecia-tion according to plan - 0 0

Tax allocation reserve,allocation during the year - 1 - 30

Tax allocation reserve, reversal 105 – – - 2 75 – –

Note 12 - Taxes, SEK m.Group

Group Parent Company according to AAA2002 2001 2002 2001 2002 2001

Current tax costTax cost during the year - 50 - 25 3 20 - 424 - 192Tax attributable to previous years 8 115 - 94 136 10 229

Deferred tax cost/tax revenue Pertaining to temporary

differences - 13 - 1 5 14 - 339 105 Resulting from previous

capitalization of tax value in loss carryforwards - 20 - 55

Tax on participation in associated company profit - 120 - 91

- 55 88 - 85 170 - 893 - 4

Reported profit before taxes 652 1.898 283 2.216 3.606 2.695

Tax according to tax rate applying for Parent Company - 183 - 531 - 79 - 621 - 1,010 - 755

Effect of other tax rates for foreign subsidiaries - 22 - 19

Amortization of consolidated goodwill - 30 - 26

Other non-tax-deductible costs - 10 - 21 - 9 - 20 - 32 - 31 Non-taxable revenues 125 529 99 660 33 107 Tax disputes 130 504 Tax attributable to prior years 8 115 - 94 136 10 229Utilization of previously non-

capitalized loss carryforwards 7 84 Tax in associated companies 11 - 108 Other 5 - 3 - 1 14 10 10

- 55 88 - 85 170 - 893 - 4

Reported effective tax 8.4% - 4.7% 30.1% - 7.6% 24.8% 0.2%

Tax items entered directly in shareholders’ equity

Group contributions received/granted 5 45

– – 5 45 – –

Ongoing tax disputesLundbergs – Lundbergs has filed an appeal with the county appeal court regarding a decision ma-

de by the tax authorities in December 2002, whereby the Parent Company’s group contributions to asubsidiary were not approved.An appeal has also been filed with the same court regarding a decisionby the tax authorities to refuse to exempt leasing fees from taxation.These cases trace their roots topreviously rejected claims for value depletion in the 1989 – 1991 tax returns.The appealed decisionsshould be viewed in the same light.The combined amount for tax and charges is SEK 93 m.The Companydoes not share the tax authorities’ opinion in either case and believes,based on the arguments alreadypresented in appeal documents, that it is not necessary to post a provision in the accounts.

Holmen – Holmen has filed an appeal regarding a decision made by the tax authorities inDecember 2002 regarding a tax surcharge imposed on a Holmen group subsidiary.The aggregateamount of taxes and charges is approximately SEK 500 m.The company does not share the tax aut-horities’ view on the case and considers that the matter has already been subject to legal proceedingsand settled.The tax authorities examined the matter as early as 1998 and rejected the deduction atthe time. Holmen appealed that decision and the county appeal court found in favor of Holmen andaccepted the deduction in a judgment made on May 22, 2001.The tax authorities did not appealagainst that judgment, which therefore became legally effective. Holmen believes that the case for im-posing a tax surcharge lacks foundation and does not share the tax authorities’ view regarding thematter. In view of this, the company has not posted a provision for the tax surcharge in its accounts.

Hufvudstaden – A tax process within Vasaterminalen is under way to determine whether or not ataxable value is to be assigned. Provisions have been posted for tax and interest payments during theperiod of grace in accordance with the ruling. During the year, the company was granted permissionto appeal the matter in the Swedish Supreme Administrative Court.

Note 13 - Goodwill, rental rights and similar rights, SEK m.

Group according to AAA2002 2001

Accumulated acquisition valueOn January 1 854 816 Divestments and scrappage - 16 - 16 Translation differences during the year - 16 45 Acquisitions during the year 10 9

832 854

Accumulated depreciation according to planOn January 1 - 147 - 83 Divestments and scrappage during the year 10 Translation differences during the year 1 - 5 Amortization during the year - 67 - 69

- 213 - 147

PLANNED RESIDUAL VALUE 619 707

Note 14 - Tangible fixed assets, SEK m.Group

Group Parent Company according to AAA2002 2001 2002 2001 2002 2001

BUILDINGS AND LANDAccumulated acquisition valueOn January 1 2,704 0 24,872 21,948 Acquisitions during the year 16 32 718 117 Reclassification of properties

classed as current assets 6 2,727 24 2,844 Divestments and scrappage

during the year - 1 - 47 - 44 Translation differences

during the year - 42 61 Write-downs 10 - 55 11 - 55

2,736 2,704 – – 25,535 24,872 Accumulated depreciationaccording to planOn January 1 - 74 - 0 - 2,628 - 2,357 Reclassification of properties

classed as current assets 0 - 44 0 - 44 Divestments and scrappage

during the year 45 35 Translation differences

during the year 24 - 25 Depreciation during the year - 29 - 30 - 239 - 237

- 103 - 74 – – - 2,798 - 2,628

PLANNED RESIDUAL VALUE 2,633 2,630 – – 22,737 22,243

CONSTRUCTION, EXTENSIONS AND REFURBISHMENT IN PROGRESSAccumulated acquisition valueOn January 1 932 515 Acquisitions during the year 96 533 Reclassification of properties

classed as current assets - 780 - 117

PLANNED RESIDUAL VALUE – – – – 248 932

Continued, Notes

•45

Group Group Parent Company according to AAA

2002 2001 2002 2001 2002 2001REAL-ESTATE EQUIPMENTAccumulated acquisition valueOn January 1 65 59 377 321 Reclassification 0 4 40 4 New acquisitions 8 2 10 52 Divestments and scrappage

during the year - 1 - 171 65 – – 426 377

Accumulated depreciation according to planOn January 1 - 61 - 56 - 179 - 160 Reclassification - 0 - 0 Divestments and scrappage

during the year 1 1Depreciation according to

plan during the year - 2 - 5 - 19 - 18 - 62 - 61 – – - 196 - 179

PLANNED RESIDUAL VALUE 9 3 – – 229 198

MACHINERY AND EQUIPMENTAccumulated acquisition valueOn January 1 35 35 5 5 19,385 18,240 Acquisitions during the year 48 4 0 1 2,191 1,139 Reclassification - 0Translation differences

during the year - 267 283 Divestments and scrappage

during the year - 6 - 4 - 1 - 0 - 531 - 277 76 35 4 5 20,778 19,385

Accumulated depreciation according to planOn January 1 - 25 - 24 - 3 - 3 - 10,535 - 9,086 Reclassification 0 0Divestments and scrappage

during the year 5 3 1 0 484 264 Translation differences

during the year 175 - 117 Write-down during the year - 620 Depreciation according to

plan during the year - 4 - 4 - 0 - 0 - 1,003 - 976 - 23 - 25 - 2 - 3 - 10,879 - 10,535

PLANNED RESIDUAL VALUE 54 10 2 2 9,898 8,851

LEASING EQUIPMENTAccumulated acquisition valueOn January 1 1 6 1 6 Divestments and scrappage

during the year - 5 - 5 1 1 – – 1 1

Accumulated depreciation according to planOn January 1 - 1 - 3 - 1 - 3 Divestments and scrappage

during the year 3 3 Depreciation according to plan

during the year - 1 - 1 - 1 - 1 – – - 1 - 1

PLANNED RESIDUAL VALUE 0 0 – – 0 0

Tax-assessment value of properties reported as fixed assetsBuildings 3,744 3,236 14,862 14,355Land 1,166 1,224 10,397 10,455

4,910 4,460 – – 25,260 24,810

In the consolidated accounts, a total of SEK 111 m. has been added to the value of buildingsand land to cover write-ups of shares in associated companies during prior years.

DUE DATES, RENTAL REVENUES

Rental revenues during the year (gross less vacancies) totaled SEK 2,051 m. (1,918). Futurerents attributable to non-cancelable operational leasing contracts have the following due dates.

Due dates, SEK m. GroupGroup according to AAA

2002 2001 2002 2001Within one year

Commercial premises 36 51 251 307 Housing 405 394 405 394 Other 31 30 83 76

Between one and five yearsCommercial premises 288 262 1,027 977 Other 80 100

Later than five yearsCommercial premises 90 93 271 109 Other 16 12

849 829 2,132 1,975

Note 15 - Participations in Group companies, SEK m.

Parent Parent CompanyCompany according to AAA

2002 2002Accumulated acquisition valueOn January 1 1,334 3,881Acquisitions during the year 0 40Divestments during the year - 0Write-downs during the year - 0BOOK VALUE 1,334 3,921

Book Shareholding value in

Number as a % of Parent of shares share capital Company

Fastighets AB L E Lundberg (publ) / 556049-0483 / Norrköping 250,000 100 165

L E Lundberg Kapitalförvaltning AB / 556188-2290 / Stockholm 150,000 100 15

L E Lundberg Nordic AB / 556274-6841 / Stockholm 1,251 100 0 L E Lundberg Invest AB / 556033-7171 / Stockholm 16,419,018 100 0 L E Lundberg Holding AB / 556563-2477 / Stockholm 1,000 100 1,153 Förvaltnings AB L E Lundberg / 556036-2260 / Stockholm 1,000 100 0 Östgöta Holding AB / 556330-0895 / Stockholm 1,000 100 0

1,334

Holmen AB (publ) / 556001-3301 / Stockholm 21,986,230 27.5 2,588 3,921

Indirectly owned Group companies (Group company/organization number/registeredheadquarters), major shareholdings

Owned by L E Lundberg Holding ABHufvudstaden AB (publ) / 556012-8240 / Stockholm 93,318,909 44.2- AB Citypalatset / 556034-7246 / Stockholm 1,200 100- AB Nordiska kompaniet / 556008-6281 / Stockholm 19,460,666 100- Aktiebolaget Hamngatsgaraget / 556068-6601 / Stockholm 3,000 100

- Vasaterminalen AB / 556118-8722 / Stockholm 2,022,000 100

Owned by Holmen AB (publ)Fiskeby AB / 556000-9218 / Norrköping 2,000,000 100Holmens Bruk AB / 556002-0264 / Norrköping 49,514,201 100AB Iggesunds Bruk / 556000-8053 / Hudiksvall 6,002,500 100Junkaravan AB / 556227-3630 / Örnsköldsvik 1,537,398 100MoDo Holding AB / 556537-6281 / Örnsköldsvik 100 100Holmen UK Ltd, Kent, United Kingdom 1,197,100 100Holmen Suecia Holding Sl, Madrid, Spain 9,448,557 100

Specification of the Parent Company’s holdings of shares and shareholdings in Group companies (Group company/organization number/registered headquarters)

•46

Continued, Notes

Note 16 - Participations in associated companies, SEK m.

Parent Company Groupaccording to AAA according to AAA

2002 2002Accumulated acquisition valueOn January 1 3,216 3,416 Purchases 1,466 Reclassification, etc. - 68

3,216 4,814

Accumulated profit participations, etc.On January 1 189 Participation in associated companies’

net profit during the year 225 Changes in associated companies’

shareholders’ equity - 26 Goodwill amortization during the year - 68

320

BOOK VALUE 3,216 5,133

Share- Share- Bookholdings as holdings as value in

a % of a % of Equity value Parentkapitalet rösterna Group Company

Directly ownedCardo AB (publ) / 556026-8517 / Malmö 33.5 33.5 2,217 1,890 NCC AB (publ) / 556034-5174 / Solna 13.6 17.0 1,036 1,075 Stadium AB / 556187-3299 / Norrköping 20.0 20.0 246 250

3,499 3,216

Indirectly ownedHarrsele AB / 556036-9398 / Sundsvall 49.4 49.4 1,466 Industriskog AB / 556193-9470 / Falun 33.3 33.3 0 Les Bois de la Baltique SA, France 33.3 33.3 20 Cartón y Papel Reciclado SA (Carpa), Spain 50.0 50.0 101 Peninsular Cogenaracion SA, Spain 50.0 50.0 42 Misc. shareholdings 5

5,133 3,216

In the Group’s income statement, participations in the profit/loss of associated companies arereported in two items: firstly, as pretax profit including any amortization of surplus value, whichis included in operating profit; and secondly, participations in the taxes of associated compani-es, which are reported together with the Group’s taxes.

Nondistributed accumulated participations in the profit of associated companies are alloca-ted to an equity participation reserve, which constitutes part of the Group’s restricted reserves.The equity participation reserve for directly owned associated companies amounts to SEK 283m. Accumulated losses are charged against the Group’s unrestricted shareholders’ equity.

Note 17 - Other long-term holdings of securities, SEK m.

ParentCompany Group

Parent according accordingGroup Company to AAA to AAA2002 2002 2002 2002

Accumulated acquisition valueOn January 1 8,968 6,123 360 474 Acquisitions during the year 936 934 894 895 Divestments during the year - 73 - 73 - 73 - 74

9,831 6,984 1,181 1,296 Accumulated write-downsOn January 1 - 76 - 75 - 75 - 85 Divestments during the year 36 36 36 36 Write-downs during the year - 66 - 59 - 59 - 66

- 106 - 98 - 98 - 115

BOOK VALUE 9,726 6,887 1,083 1,181

Specification of other long-term holdings of securities,SEK thousands

Market value, Book value Book value in Book value in GroupDec. 31, 2002 in Group Parent Company according to AAA

PARENT COMPANYMajor shareholdingsCardo AB (publ) 2,017,700 1,890,095 1,890,095 Holmen AB (publ) 4,647,527 2,587,727 2,587,727 Hufvudstaden AB (publ) 2,544,144 2,827,790 Industrivärden AB (publ) 871,650 927,856 916,596 927,856 NCC AB (publ) 729,371 1,075,472 1,075,472 Stadium AB 250,141 250,141

10,810,392 9,559,081 6,720,031 927,856Other listed sharesVolvo B 120,700 120,700 120,700 120,700

120,700 120,700 120,700 120,700Other sharesIndustrial Development &

Investment Equity KB 45,725 45,725 45,725 Industrial Development &

Investment AB 250 250 250 Industrial Development &

Investment Ltd 12 12 12 Sponsorteamet Våga Vinna AB 5 5 5

– 45,992 45,992 45,992

GROUPOther participationsBrännälvens Kraft AB 36,400 Drumheid AB 30 30 Fastighets AB Kajkanten 25 25 Göteborgs Byggmästares

Intresseförening 10 10 Linköping City Business Center AB 10 10 Papeles Allende SA, Spain 49,494 Other shareholdings 0 866

– 75 – 86,835

– 9,725,848 6,886,723 1,181,383

Note 18 - Other long-term receivables, SEK m.

Parent GroupGroup Company according to AAA2002 2002 2002

Accumulated acquisition valueOn January 1 27 28 284 Receivables added 4 9 26 Receivables settled - 20 - 12 - 91

10 25 219

Accumulated write-downsOn January 1 - 13 - 13 - 13 Receivables settled 12 12 12 Write-downs during the year - 4 - 0 - 4

- 4 - 1 - 4 BOOK VALUE 6 24 215

Specification of Parent Company and Group holdingsof participations in associated companies

•47

Note 19 - Properties classified as current assets, SEK m.

Group Group according to AAA2002 2002

DEVELOPMENT PROPERTIESAccumulated acquisition valueOn January 1 133 133Acquisitions 3 3Reclassifications - 6 - 6Divestments and scrappage - 4 - 4Write-downs 0 0 BOOK VALUE 126 126

The tax-assessed value of the Group’s properties amounted to SEK 150 m. (156).

Note 20 - Inventories, etc., SEK m.

Group Group according to AAA2002 2002

Shares in publicly traded companies 77 77 Felling rights 237 Finished products, goods for resale

and products in progress 1,135 Advances to suppliers 3 Raw materials and consumables 730 Timber and pulpwood 139

77 2,321

At year-end, the market value of shares in publicly traded companies was SEK 77 m.

Note 21 - Prepaid expenses and accrued income, SEK m.

Parent GroupGroup Company according to AAA2002 2002 2002

Prepaid expenses 12 119 Accrued rental revenues 20 Accrued interest on rental revenues 10 0 21 Other 1 1 3

24 1 163

Note 22 - Cash and bank balances, SEK m.

Parent GroupGroup Company according to AAA2002 2002 2002

Overdraft facility granted 100 100 2,165Overdraft facility utilized – – –Amount disposable 100 100 2,165

Note 23 - Shareholders’ equity, SEK m.

Restricted equityUnrestricted Share Restricted Total

equity capital reserves equityGROUPOn January 1 8,074 683 690 9,447Dividend - 357 - 357 Repurchase of Parent Company shares - 13 - 13 Cancellation of repurchased shares 61 - 61New share issue 61 61Redemption of share - 61 - 61Transfer between restricted

and unrestricted equity - 119 119 Reported net profit for the year 597 597 BALANCE, DECEMBER 31, 2002 8,245 621 808 9,675

PARENT COMPANYOn January 1 6,901 683 282 7,866 Dividend - 357 - 357 Repurchase of own shares - 13 - 13 Cancellation of repurchased shares 61 - 61 New share issue 61 61Redemption of share - 61 - 61Transfer on redemption - 61 61Group contributions received/granted 17 17 Tax effect of Group contributions - 5 - 5Reported net profit for the year 198 198BALANCE, DECEMBER 31, 2002 6,743 621 344 7,708

GROUP ACCORDING TO ANNUAL ACCOUNTS ACTOn January 1 9,599 683 880 11,162 Dividend - 357 - 357 Repurchase of Parent Company shares - 13 - 13 Cancellation of repurchased shares 61 - 61 New share issue 61 61Redemption of share - 61 - 61Translation differences during the year - 109 - 109 Changes in Group composition, partly

due to other Group companies repurchasing their own shares - 27 24 - 3

Transfer between restricted and unrestricted equity - 187 187

Reported net profit for the year 1,100 1,100 BALANCE, DECEMBER 31, 2002 10,067 621 1,092 11,780

Note 24 - Accumulated depreciation in excess of plan, SEK m.

Parent Company2002 2001

Machinery and equipment 0 0 0 0

Untaxed reserves include SEK 0 m. (0) for deferred tax. Deferred tax is not included in theParent Company’s balance sheet, only in the Group’s.

Note 25 - Tax allocation reserves, SEK m.

Parent Company2002 2001

Tax allocation reserve, allocated for 1998 tax year 191 191 Tax allocation reserve, allocated for 1999 tax year 36 36 Tax allocation reserve, allocated for 2000 tax year 175 175 Tax allocation reserve, allocated for 2001 tax year 16 16 Tax allocation reserve, allocated for 2002 tax year 30 30 Tax allocation reserve, allocated for 2003 tax year 1

450 448

Untaxed reserves include SEK 126 m. (126) for deferred tax. Deferred tax is not included in theParent Company’s balance sheet, only in the Group’s.

•48

Continued, Notes

Note 26 - Provision for deferred taxes, SEK m.

Group, 2002 Group according to AAA, 2002Deferred tax Deferred tax

Receivable Liability Net Receivable Liability NetBuildings and land - 254 - 254 - 3,775 - 3,775 Machinery and equipment - 2 - 2 - 1,681 - 1,681 Pension provisions - 0 - 0 Tax allocation reserve - 142 - 142 - 729 - 729 Tax loss carryforwards 317 317Other provisions 27 27 27 - 495 - 468

27 - 398 - 371 344 - 6,680 - 6,337

Group, 2001 Group according to AAA, 2001Deferred tax Deferred tax

Receivable Liability Net Receivable Liability NetBuildings and land - 246 - 246 - 3,656 - 3,656Machinery and equipment - 1 - 1 - 1,531 - 1,531Pension provisions - 0 - 0 Tax allocation reserve - 137 - 137 - 586 - 586 Tax loss carryforwards 329 329Other provisions 14 14 14 - 416 - 402

14 - 384 - 370 343 - 6,190 - 5,847

Note 27 - Other provisions, SEK m.

Group Group according to AAA2002 2002

PRI pensions 26 56 Property tax owed 160 Taxes 18 46Other provisions 2 235

46 496

Note 28 - Liabilities to credit institutions, SEK m.

Group Group according to AAA2002 2002

Loans for completed properties 1,042 4,027Other liabilities to credit institutions 2,025

1,042 6,052

Current portion of liabilities to credit institutions 0 951 1,042 7,004

Payment due 1 – 5 years after December 31, 2002 1,042 5,699 Payment due later than 5 years from December 31, 2002 353

1,042 6,052 Pledged assetsProperty mortgages 2,056 3,889

Note 29 - Other liabilities, SEK m.

Parent GroupGroup Company according to AAA2002 2002 2002

Long termSubordinated loans 394 Other liabilities 9 0 9

9 0 403 CurrentSubordinated loans 600 2,397 Other liabilities 823 764 1,205

1,423 764 3,602 Collateral pledgedBank accounts 21 - 21

Other liabilities include a total of SEK 23 m. (18) for options on shares in Cardo AB (publ),Holmen AB (publ) and Hufvudstaden AB (publ) that were issued to senior executives in thesecompanies. Subordinated loans include SEK 351 m. for a convertible debenture loan to HolmenAB (publ) personnel. Conversion to Series B Holmen shares will be possible during the periodFebruary 1 to March 31, 2004 at a conversion price of SEK 112.70 per share.

Agreements have been concluded concerning the issue of commercial paper in the Swedishmoney market in a total nominal amount for Lundbergs of not more than SEK 2 billion and forHolmen of not more than SEK 4 billion. In addition, Holmen has an as yet unutilized credit limitof SEK 4 billion within a Swedish Medium Term Note program.

Note 30 - Contingent liabilities

The contingent liabilities for Parent Company and the Group include SEK 93 m. related to rejec-ted tax deductions for Group contributions granted to subsidiaries and to a rejected claim fortax-exemption for leasing fees. The contingent liabilities for the Group in accordance with theAnnual Accounts Act also include SEK 538 m. related to the tax authoritie´s decision to levy taxarrerars from a subsidiary of the Holmen group.

Note 31 - Accrued expenses and prepaid income, SEK m.

Parent GroupGroup Company according to AAA2002 2002 2002

Wages, salaries and social security costs 24 3 673 Rental revenues 84 284 Interest expense 7 81 Other 27 2 47

142 5 1,085

•49

Accounting principles and commentary

General accounting principlesThe Annual Report has been prepared in accordance with theAnnual Accounts Act and the Financial Accounting StandardsCouncil’s recommendations. As of January 1, 2002, the fol-lowing new recommendations from the Financial AccountingStandards Council, which became effective on the same date,are applied: RR 1:00 Consolidated accounting, RR 15Intangible assets, RR 16 Provisions, contingent liabilities andpossible assets, RR 17 Write-downs, RR 19 Operations underliquidation, RR 21 Loan expenses and RR 23 Informationabout closely related companies. The new accounting princi-ples had no impact on reported earnings or the balance sheetat December 31, 2002.

Assets, provisions and liabilities have been computed at acquisition value, unless otherwise stated.

Reporting of revenuesThe reporting of revenues occurs in pace with the transfer totenants or purchasers of significant risks and benefits associatedwith the Company’s services and products.

Depreciation/amortizationDepreciation/amortization according to plan is based on theacquisition value of assets, where relevant after adjustment forwrite-ups or write-downs, and their estimated economic life.The acquisition of the former associated companies Cardo andStadium gave rise to goodwill. In view of the long-term andstrategic nature of these acquisitions, this goodwill will beamortized straight line over a period of 20 years. The sameprinciple applies to Holmen’s holding of Papelera Peninsularshares (Note 1).

Depreciation/amortization is computed in accordance withthe following percentages/economic life:• Machinery and equipment, 10 - 33%• Building equipment, 5 - 10%• Production machinery, 5 - 8%• Buildings classified as fixed assets, 1 - 5%• Production machinery, 5 - 8%• Forest roads, 10%• Goodwill, 5 - 20%• Land improvements classified as fixed assets, 3.75 - 5%

Items affecting comparabilityThe Swedish Accounting Standards Council’sRecommendation No. 4 is applied, which means that the ef-fect on profit of special events and transactions of special sig-nificance are specified within each profit concept. Wheneverapplicable, items affecting comparability are reported on theirown lines in the income statement under the relevant area ofoperations.

Loan expensesLoan expenses are charged against earnings during the periodto which they are attributable, regardless of how the borrowedfunds are used.

TaxesThe Company and the Group apply the Financial AccountingStandards Council’s RR 9 Recommendation, Income Taxes.Total tax consists of current tax and deferred tax. Taxes are re-ported in the income statement, with the exception of itemswhere the underlying transactions are reported directly againstshareholders’ equity, in which case the relating tax effect is re-ported in shareholders’ equity. Current tax (previously calledPaid tax) is the tax to be paid or received for the current year.Adjustment of current tax attributable to previous periods is al-so included here.

Deferred tax is calculated in accordance with the balance-sheet method, on the basis of the temporary differences be-tween the reported and taxable value of assets and liabilities.The amounts are computed on the basis of expectations ofhow the temporary differences will offset each other and byapplying the tax rates and tax regulations that have been de-cided or announced at year-end. Temporary differences arenot taken into account for consolidated goodwill or in differ-ences pertaining to shares in subsidiaries or associated com-panies that are not expected to become subject to tax in theforeseeable future. Untaxed reserves within a legal entity arereported including deferred tax liabilities. In the consolidatedfinancial statements, however, untaxed reserves are dividedbetween deferred tax liabilities and shareholders’ equity.

Deferred tax receivables in deductible temporary differencesand tax loss carryforwards are only reported to the extent thatthey are likely to result in lower tax payments in the future.

In cases involving pure asset-and-liability acquisitions, thevaluation of deferred tax is based on the market value.

ReceivablesReceivables are reported in the amounts expected to be re-ceived, after individual valuation.

Receivables and liabilities in foreign currenciesReceivables and liabilities in foreign currencies are translatedinto Swedish kronor at year-end rates or, in the case of hedg-ing, the forward rate. Exchange-rate differences are includedin operating profit, with the exception of exchange-rate differ-ences on short-term investments, cash and bank balances, fi-nancial liabilities and interest-bearing provisions, which arereported in net financial items. Exchange-rate differences per-taining to the hedging of future currency flows are included inprofit during the same period as the underlying currency flow(Note 1).

The currency composition of financial liabilities haschanged as a result of the use of forward contracts. These for-

•50

Continued, Accounting principles

ward contracts are valued at the year-end exchange rate and theunrealized gain/loss is reported net as a liability. Any forwardpremium/deduction is regarded as interest, becomes subject toaccrual and is reported among net interest expense (Note 1).

Loans and forward contracts in foreign currency can be usedto reduce the exchange-rate effect on translation of the net as-sets of foreign subsidiaries into SEK. The exchange-rate differ-ences on these loans are eliminated from the income state-ment, to the extent that they are matched by exchange-ratedifferences on foreign net assets, after taking tax effects intoaccount, and transferred directly to shareholders’ equity in thebalance sheet. Such hedging is based on the consolidated val-ue of the net assets by currency (Note 1).

Short-term investmentsShort-term investments that are reported among current assetsare valued individually according to the lowest value princi-ple. Interest and currency futures are expensed to the extentthat unrealized losses exist on the closing date.

Properties reported as fixed assetsThese properties are normally entered at acquisition value lessdepreciation according to plan. The acquisition value of prop-erties constructed by the Company consists of direct costs plusa reasonable share of indirect costs. Write-downs are bookedin cases where the market value of properties is lower than theacquisition value.

Properties classified as current assetsProperties classified as current assets are valued in accordancewith the lowest value principle per property or per valuationunit. The requisite write-down and reversal of previous write-downs in accordance with this principle are reported as“Write-downs.”

Inventories Inventories are valued at acquisition or manufacturing cost, af-ter a deduction of 3% for obsolescence, or real value,whichever is lower. The acquisition value of proprietarily-de-veloped finished products consists of direct manufacturingcosts and a reasonable portion of indirect costs. The real valueof finished products is the sales value less estimated salescosts. The real value of timber, pulp, other raw materials andsimilar items is the replacement value or the acquisition valueafter a deduction for actual obsolescence, whichever is lower(Note 1).

Consolidated accountsLundbergs holds a majority of the voting rights in Holmen andHufvudstaden. Thus, in accordance with the Annual AccountsAct, Hufvudstaden and Vasaterminalen should be reported assubsidiaries. At year-end, Lundbergs accounted for 44.2% ofthe share capital in Hufvudstaden and 27.5% of the share cap-

ital in Holmen, which gives rise to a large minority share inthe consolidated financial statements, if the Annual AccountsAct is applied.

In order to provide a fair description of the Group’s opera-tions, however, reporting holdings of shares in publicly tradedsubsidiaries and associated companies from the perspective ofcash flow and net asset value is a better method. The holdingsare therefore treated as pure shareholdings (other long-termholdings of securities) in the consolidated financial statements.Consolidation in accordance with the Annual Accounts Act ispresented in Note 1.

Holdings in joint ventures are reported in accordance withthe proportional consolidation method. This means that thecompanies are reported as if they were subsidiaries but withthe difference that only the Group’s participation in the com-panies’ revenues and expenses, and assets and liabilities, arereported in the Group’s income statement and balances sheet,respectively.

Complete consolidated financial statements in accordancewith the Annual Accounts Act (Note 1)The Group’s income statement and balance sheet in Note 1are prepared in accordance with the Swedish FinancialAccounting Standards Council’s recommendation concerningconsolidated accounts (RR 1:00).

An income statement divided by type of costs has been usedfor the accounts of Holmen, while the function-dividedmethod has been used for all other parts of the Group. Theconsolidated accounts prepared in accordance with theAnnual Accounts Act include the Parent Company and allcompanies in which the Parent Company owns, directly or in-directly, more than 50 percent of the voting rights.

The purchase method is used for the preparation of theGroup’s accounts. Earnings in companies purchased during theyear are included in the Group’s income statement only for theperiod after the date of purchase. Surplus value is amortized inaccordance with the principles for the type of asset concerned.

The Financial Accounting Standards Council’s recommen-dation RR8 is used for the translation of the accounts of for-eign subsidiaries.

Shareholdings in companies in which the Group holds morethan 20 percent and a maximum of 50 percent of the votingrights or in some other manner has a decisive influence on op-erations and financial control are normally reported in accor-dance with the equity method. In the consolidated financialstatements, this entails that the book value of shares in associ-ated companies corresponds to the share in the associatedcompanies’ shareholders’ equity, as well as any residual valuefor consolidated surplus value. The amortization period forsurplus value is 5 to 20 years.

The Group’s share in the profit of associated companies be-fore tax and adjusted for amortization of acquired surplus val-ue is reported as “Profit from participations in associated com-

•51

panies” in the consolidated income statement. The Group’s participation in the reported tax of associated

companies is included in the Group’s tax costs. Profit partici-pations accumulated after the acquisition of associated com-panies and which have not yet been realized through dividenddistribution, are allocated to the equity participation reserve,which represents part of the Group’s restricted shareholders’equity.

Information about the GroupThe Parent Company´s purchases from other Group compa-nies amounted to SEK 3 m. The Parent Company´s sales to other Group companies amounted to SEK 0 m.

Group and shareholder contributionsIn the Parent Company income statement, Group contribu-tions are now entered directly in shareholders’ equity. Thecomparative figures for the preceding year have been adjustedaccordingly.

Shareholder contributions are entered directly in the recipi-ent’s shareholders’ equity and are capitalized as shares andparticipations in the provider’s accounts, to the extent that nowrite-down is required.

Convertible debenture loan and warrants in Holmen (Note 1)The size of the loan has been computed on the basis of themarket interest rate at the time it was raised. The difference be-tween the principal computed in this way and the amount car-ried forward is entered in the premium reserve. Interest ac-crued during the term of the loan is added successively to theloan liability. Payments received for issued warrants are report-ed in the premium reserve.

Cash flow statementsThe cash flow statements are prepared in accordance with theindirect method, in line with the Financial AccountingStandards Council’s Recommendation No. 7.

ProvisionsIn accordance with the Financial Accounting StandardsCouncil’s recommendation RR 16 Provisions, contingent lia-bilities and possible assets, a provision is reported in the bal-ance sheet when the company has a formal or informal com-mitment resulting from an event that has occurred and it isprobable that an outflow of resources will be required to settlethe commitment and the amount concerned can be reliablyestimated.

Contingent liabilitiesA contingent liabilities is reported as a memorandum item if:

- there is a possible commitment deriving from events thathave occurred whose existence can only be confirmed if

one or more uncertain future events that are not fully within the control of the company occur or fail to occur,

or- a commitment deriving from events that have occurred has

not been reported as a liability or entered as a provision because it is not certain that an outflow of resources will be required to settle the commitment or it is not possible to estimate the amount of the commitment with sufficient accuracy.

Closely related companies

Close relationships that result in controlling influenceGroupVia his wholly owned subsidiary Byggnads AB Karlsson &Wingesjö, Fredrik Lundberg directly or indirectly holds 89.4%of the voting rights and 52.4% of the share capital in L ELundbergföretagen AB (publ.).

Parent CompanyIn addition to the close relationships stated for the Group, theParent Company has close relationships that result in control-ling influence over its subsidiaries (see Note 15).

Transactions with closely related companiesGroupSee Note 2 for information regarding wages, salaries, remuner-ation and expenses, and commitments with respect to pen-sions and similar benefits, as well as agreements regardingseverance pay.

With shareholders and companies over which he has a con-trolling influence:Loans from these shareholders and companies amounted toSEK 740 m. at the end of 2002. Interest expense of SEK 28 m.was paid on normal market terms. Management and consult-ing services of a technical or administrative nature were pro-vided by the Group for SEK 8 m. during the year. These ser-vices were priced on normal market terms.

With associated companies:Products and services in an amount of SEK 27 m. were pur-chased. These purchases were conducted on normal marketterms. The liability on December 31, 2002 was SEK 2 m.

OtherIn certain cases, reported figures have been rounded off. As aresult, amounts in tables and calculations do not always tally.In running texts and tables (with the exeption of the real estatespecification) amounts between 0 and 0.5 are rounded downto 0. If no figure is applicable, this is designated with a dash (-).

•52

Stockholm, February 20, 2003

Per Welin Lennart Bylock Michael Knutsson Chairman of the Board

Ulf Lundahl Christer Nöjd Sten Peterson

Bengt Pettersson Christer Zetterberg Fredrik LundbergPresident and CEO

Auditors’ Report To the Annual General Meeting of L E Lundbergföretagen AB (publ),organization number: 556056-8817

We have audited the annual report, the consolidated finan-cial statements, the accounts and the administration of theBoard of Directors and the President of L E Lundberg-företagen AB (publ) for the 2002 fiscal year. These accountsand the administration of the Company are the responsibilityof the Board of Directors and the President. Our responsi-bility is to express an opinion on the financial statementsand the administration based on our audit.

We conducted our audit in accordance with GenerallyAccepted Auditing Standards in Sweden. Those standardsrequire that we plan and perform the audit to obtain rea-sonable assurance that the financial statements are free ofmaterial misstatement. An audit includes examining, on atest basis, evidence supporting the amounts and disclo-sures in the financial statements. An audit also includes as-sessing the accounting principles used and their applica-tion by the Board of Directors and the President, as well asevaluating the overall presentation of information in theannual accounts and the consolidated financial statements.

We examined significant decisions, actions taken andcircumstances of the Company in order to be able to deter-mine the possible liability to the Company of any Boardmember or the President. We also conducted examinations

to determine whether any Board member or the Presidenthave in some other way acted in contravention of theCompanies Act, the Annual Accounts Act or the Articles ofAssociation. We believe that our audit provides a reason-able basis for our opinion set out below.

The annual accounts and consolidated financial state-ments have been prepared in accordance with the AnnualAccounts Act and consequently provide a true and fair pic-ture of the Company’s and the Group’s earnings and finan-cial position in accordance with generally accepted audit-ing standards in Sweden.

We recommend that the Annual General Meeting adoptthe income statements and balance sheets of the ParentCompany and the Group, that the profit in the ParentCompany be dealt with in accordance with the proposal inthe Report of the Board of Directors, and that the membersof the Board and the President be discharged from liabilityfor the fiscal year.

Stockholm, February 26, 2003

Bo Ribers Hans WilhelmssonAuthorized Public Accountant Authorized Public Accountant

Group, according to the Annual Accounts ActThe Group’s unrestricted equity amounts to SEK 10,067 m.(9,599). An allocation of SEK 18,000 to restricted reservesis proposed.

L E Lundbergföretagen AB (publ)The Board of Directors and President propose that the fundsavailable for distribution by the Annual General Meeting, anamount of SEK 6,743 m., or to be precise SEK 6,742,619,521,be distributed as follows:

To shareholders, a dividend of SEK 6.00 per share SEK 372 m.

To be carried forward SEK 6,371 m.

SEK 6,743 m.

April 8, 2003 is proposed as the record date for payment ofdividends. If the Annual General Meeting approves the pro-posal, the dividends will be distributed by VPC on April 11,2003.

Proposed distribution of profits

•53

Definitions

Debt/equity ratioInterest-bearing net debt in relation toequity.

Direct returnDividend (for 2002, the proposed di-vidend) per share as a percentage ofmarket share price on December 31.

Equity/assets ratioReported equity as a percentage of to-tal assets.

Estimated operating net, real estateActual rental revenues, including in-terest subsidies, less property tax,standard expenses for maintenancemeasures and tenant-oriented impro-vements, as well as actual operatingexpenses. The operating net does notinclude direct sales and administrati-ve costs or central administrativecosts.

Full taxCurrent paid, deferred tax and tax onparticipations in associated compa-nies.

Liquid assetsCash and bank balances and interest-bearing short-term investments.

Medium-term investments/holdingsThis term is synonymous with portfo-lio investments/holdings.

Net asset valueMarket value of the Group’s assetsless liabilities and deferred tax inhidden reserves.

Net interest-bearing debtInterest-bearing liabilities less inter-est-bearing assets.

Net sales, Real EstateRental revenues and interest subsidies,proceeds from sales of propertiesclassed as current assets or sales ofshareholdings, and other revenues.

Net sales, InvestDividends, proceeds from sales ofshares and gains/losses from otheroperations.

Operating revenues, Real EstateRental revenues, interest subsidies(rental revenues, etc.), gains on salesof properties and other revenues.

Operating revenues, InvestDividends, gains/losses on sales of se-curities (realized gains/losses and va-lue adjustments).

Operating expensesCosts for property care, water, hea-ting, electricity, chimney sweeping,etc.

Operating net, Real EstateRental revenues, including interestsubsidies, less property tax and ex-pensed maintenance measures andtenant-oriented improvements, aswell as operating expenses. The ope-rating net does not include direct sales and administrative costs or cen-tral administrative costs.

P/E ratioMarket share price on December 31in relation to profit per share.

Pay-out ratio per shareDividend as a percentage of profitper share.

Portfolio investments/holdingsThis term is synonymous with medium-term investments/holdings.

Profit per shareReported profit after full tax dividedby the average number of shares out-standing.

Property costsOperating expenses, property tax ex-pensed costs for maintenance and fortenant-oriented improvements, directsales and administrative costs and de-preciation.

Return on equityReported profit as a percentage ofaverage equity during the year.

Vacancy rateThe total possible rental revenues lessactual rental revenues during the yearas a percentage of the total possibleannual rental revenues.

Yield on propertiesThe operating net in relation to thebook value of properties at year-end.

•54

Real estate specification

Rentable floor space, January 1, 2003, thousands of square meters

Region Housing Offices Retail Industrial Other Garage Total %Eastern 111 37 40 15 24 42 269 27Western 155 24 23 0 7 21 230 23Mälardalen 171 11 14 0 10 19 225 22Stockholm 104 40 9 0 6 17 176 17Gothenburg 6 51 2 32 4 11 106 11

Total 547 163 88 47 51 110 1 006 100

Total, % 54 16 9 5 5 11 100

Annual rental revenues, January 1, 2003, SEK m.

Region Housing Offices Retail Industrial Other Garage Total %Eastern 83 45 55 8 9 7 207 25Western 118 23 32 0 2 6 181 21Mälardalen 116 9 13 0 5 4 147 18Stockholm 82 105 15 0 6 6 214 25Gothenburg 5 66 2 18 1 4 96 11

Total 404 248 117 26 23 27 845 100

Total, % 48 29 14 3 3 3 100

Taxable value, Value Rentable floor space revenues,Name of the property Address SEK 000s, 2002 year Housing Offices Retail Industrial Other Garage Total 2003

EASTERN REGION

LinköpingBlåklockan 24 Storg. 7-9

Snickareg. 13 23,036 1956 1,987 0 0 0 2,631 400 5,018 3,818Braxen 19 Åg. 12

Storg. 13-19Snickareg. 18-24 Repslagareg. 21 58,688 1967 0 1,015 8,038 0 1,541 2,500 13,094 10,039

Brushanen 8 Klosterg. 7-9Vasav. 3 36,771 1960 6,239 454 0 0 81 1,020 7,794 5,120

Flodhästen 17 Västanåg. 16 10,944 1962 1,989 0 0 0 83 85 2 157 1,520Forskaren 7 Västanåg. 15-17 15,632 1969-70 2,796 0 0 0 17 1,144 3 957 2,099

Total Linköping 145,071 13,011 1,469 8,038 0 4,353 5,149 32,020 22,596

NorrköpingAnkarstocken 17(25.95%) Repslagareg. 894 1978 0 0 0 0 0 2,803 2,803 179Asken 42 Tunnbindareg. 18-24

Vatteng. 7 41,750 1979 7,362 758 0 0 0 1,420 9,540 6,753Bomullsspinneriet 1 Holmeng. 26(50%) Holmentorget 10 0 1998 0 0 0 0 3,855 0 3,855 5,401Bron 3 Hamng. 2-4

Flemingg. 1Drottningg. 2-4 18,258 1940 2,615 1,532 679 0 419 0 5,245 4,026

Djupet 19 S:t Persg. 86, 90-92 Hörng. 2 Nyg. 79-81Bryggareg. 1-7 33,345 1949/77 7,708 40 1,398 0 193 470 9,809 7,147

Eken 8 Skolg. 9-11Generalsg. 20-26 Knäppingsborgsg. 18 28,317 1974 6,255 0 351 0 0 0 6,606 4,895

Enväldet 9 Bråddg. 7-15 54,468 1964 0 9,217 2,502 0 47 4,570 16,336 13,264

Lundbergs real estate operations consist of 157 wholly and partlyowned completed properties and about 100 development objects,as well as a number of external management assignments.Lundbergs’ own properties have an estimated market value ofSEK 6,814 m. (6,844) and a book value of SEK 2,769 m. (2,766).A total of 1,245,000 square meters of floor space is managed.Lundbergs’ own real estate portfolio comprises 54% (54) residentialand 46% (46) commercial premises, etc.

Rental revenues in 2003 comprise actual rental income plusestimated market rents for unrented floor space. The figuresshown for tax assessment value, floor space and annual rentalrevenues correspond to the share owned by the Group. In caseswhere a property has more than two value years, only the oldestand most recent figures are shown in this specification.

The Tryckeriet 12 property in Örebro, with 3,272 square me-ters of floor space, was sold, effective January 1, 2003, and isthus not included in the specification below.

Rental

•55

Exportzonen 1 Terminalg. 1,203 1989 0 0 0 0 3,440 0 3,440 998Gamlabron 17 (50%) Västgöteg. 7 8,568 1982 0 0 0 0 1,476 0 1,476 1,485Gladan 18 Trozellig. 20-22

Askebyg. 3Petter Swartzg. 24 22,385 1960 5,377 247 0 0 284 349 6,257 4,150

God Vän 17 Nyg. 35 7,803 1960 1,913 0 0 0 0 330 2,243 1,434Gropen 6 Holmentorget 1(50.0%) Källvindsg. 3-5 0 1959 0 0 0 0 2,079 460 2,539 3,007Gropen 8 Holmentorget 3(50.0%) Källvindsg. 1 98 1930 0 0 0 0 590 0 590 531Gördeln 14 Vatteng. 14

Tunnbindareg. 25-31Bråddg. 33-39 Kungsg. 19-21 77,685 1983 14,986 0 389 0 57 3,288 18,720 13,143

Johannes 21(25.95%) Repslagareg. 599 1970 0 0 0 0 0 2,811 2,811 179Konstantinopel 15 (50.0%) G:a Rådstugug. 42-44 2,636 1998 257 0 112 0 0 0 369 403Kopparkypen 34(50.0%) Kungsg. 57-59 2,656 1929/54 0 63 0 0 848 0 911 66Kopparn 1 Kopparg. 9 10,191 1973 0 1,320 0 4,565 0 0 5,885 3,354Kromen 3 Kopparg. 7 25,767 1966/98 0 250 0 10,454 0 0 10,704 5,601Kvarnholmen 3 (50.0%) Holmeng. 8,14

Dalsg. 11-13 13,930 1992-93 0 1,791 252 0 259 0 2,302 2,641Linden 13 Drottningg. 41

Hantverkareg. 23-29Prästg. 14-16 84,660 1976 0 0 8,999 0 1,575 300 10,874 18,584

Linjen 1 Spjutg. 1-35 38,713 1964 9,689 0 0 0 0 588 10,277 7,231Lybeck 24 Trädgårdsg. 49

Styrmansg. 10 14,969 1980 2,787 311 0 0 0 994 4,092 2,656Lyckan 14 (50%) Olai Kyrkog. 35-37 2,451 1960 415 0 126 0 77 0 618 486Nyckeln 3 Skolg. 39

Östra Prom. 24 5,749 1959 1,458 0 0 0 0 0 1,458 1,079Paraden 8 (50%) Dalsg. 18-20 2,333 1975 0 892 0 0 0 0 892 469Spinnrocken 1 Olai Kyrkog. 39 2,130 1930 350 0 354 0 0 0 704 484Spiran 9 G:a Rådstugug. 35

Drottningg. 54-62S:t Persg. 95-97 109,929 1969/79 0 6,451 6,131 0 2,416 14,000 28,998 17,739

Stabben 9 (50%) Källvindsg. 2-4 4,415 1959 0 0 0 0 1,276 0 1,276 943Staren 14 Skeppareg. 44-48

Generalsg. 43-47 45,941 1961 10,321 890 817 0 155 1,656 13,839 9,200Torget 6 Nya Rådstugug. 1-3

G:a Rådstugug. 1BFlemingg. 2Drottningg. 6 33,919 1960 1,342 5,649 519 0 284 0 7,794 6,217

Tulpanen 18 Drottningg. 55Hantverkareg. 24-26 S:t Persg. 101-105Olai Kyrkog. 36-38 105,577 1965/80 0 4,710 9,219 0 376 1,679 15,984 21,438

Vinpipan 12 Bråddg. 38-42Luntg. 24-26Slottsg. 137-143 47,177 1980 8,293 1,517 133 0 0 1,251 11,194 8,100

Västra Huken 10 Repslagareg. 39-43Skeppareg. 37-41Styrmansg. 38 29,867 1959/74 7,071 0 0 0 0 0 7,071 5,346

Ärlan 14 Hantverkareg. 60-68S:t Persg. 149-153Skeppareg. 45-47Östra Prom. 36-38 38,226 1959/77 9,166 0 295 0 99 0 9,560 7,127

Various minor properties 2,172 589 0 0 0 277 0 866 84

Total Norrköping 918,781 97,954 35,638 32,276 15,019 20,082 36,969 237,938 185,840

Total Eastern Region 1,063,852 110,965 37,107 40,314 15,019 24,435 42,118 269,958 208,436

Taxable value, Value Rentable floor space revenues,Name of the property Address SEK 000s, 2002 year Housing Offices Retail Industrial Other Garage Total 2003

Rental

WESTERN REGION

ArvikaBagaren 2 Östra Torgg. 1 14,140 1970 355 1,146 456 0 1,008 740 3,705 2,277Filaren 9 Norra Esplanaden 5-7

Jakobsg. 6-8 12,040 1968 5,118 44 0 0 0 464 5,626 3,421Fogden 2 Kyrkog. 33 895 1935 85 0 207 0 0 0 292 286Fogden 8 Magasinsg. 6

Storg. 36 4,494 1974 361 0 1,450 0 40 0 1,851 1,360Hammaren 5, 6 Parkg. 13-19 29,306 1975-76 11,122 0 0 0 0 1,510 12,632 7,763Juvelen 8 Storg. 30 8,835 1961 1,338 0 1,409 0 55 733 3,535 2,388Långdansen 6 Hagag. 4 - 6

Västra Kyrkog. 52-54 13,723 1970 5,476 0 0 0 0 474 5,950 3,666Skepparen 9 Kyrkog. 14-16 16,314 1983 4,515 751 0 0 0 1,216 6,482 4,057Vakten 9 Kyrkog. 22 5,169 1970 268 257 1,140 0 0 0 1,665 1,116

Total Arvika 104916 28,638 2,198 4,662 0 1,103 5,137 41,738 26,334

FalköpingKronhjorten 22 (50%) Järnvägsg. 2-12 10,758 1972 2,798 265 343 0 0 4 3,410 2,432

JönköpingAlmen 13 Östra Storg. 20

Smedjeg. 15 Borgmästargr. 8 24,427 1964 0 796 2,864 0 0 0 3,660 4,696

Astern 9 Borgmästargr. 3Östra Storg. 24 Smedjeg. 21 10,730 1959 0 706 1,595 0 0 0 2,301 3,415

Björnen 10 Oskarsg. 10 Tormenåsg. 13 8,272 1969 2,454 0 0 0 0 260 2,714 1,813

Cedern 1 Föreningsg. 7 11,323 1964 2,735 0 0 0 10 0 2,745 1,991Censorn 10 Norra Strandg. 74

Östra Storg. 75 9,368 1963 1,875 184 244 0 0 61 2,364 1,762Cikadan 6 Norra Strandg. 70-72

Östra Storg. 73 Strandgr. 2 20,541 1960 4,481 107 344 0 0 155 5,087 3,588

Farkosten 3 Östra Storg. 155-161 30,464 1965 7,228 0 0 0 0 0 7,228 5,500Farkosten 4 Östra Storg. 151-153 16,879 1975 3,746 0 0 0 0 0 3,746 2,780Faust 1 Mellang. 35 5,140 1965 1,212 0 0 0 0 130 1,342 927Färgen 9 Östra Storg. 116

Rosenbergsg. 1-5 17,142 1962 3,760 0 448 0 0 450 4,658 3,054Gasellen 6 Barnarpsg. 23

Nyg. 11Smålandsg. 20 17,272 1965 0 2,325 958 0 110 1,184 4,577 3,526

Grundlagen 5 Kyrkog. 34 Brunnsg. 5 36,108 1987 0 5,740 0 0 0 1,520 7,260 7,134

Hinden 8 Brunnsg. 14A-BBarnarpsg. 30-34 23,969 1998 2,427 0 289 0 0 516 3,232 3,197

Klubban 1 Braheg. 18 6,384 1968 1,491 0 0 0 0 170 1,661 1,124Korallen 5 Tegnérg. 17-25 14,791 1975 3,264 0 0 0 0 0 3,264 2,444Laxen 10 Tormenåsg. 24-26 8,795 1967 2,706 0 0 0 20 150 2,876 1,957

Total Jönköping 261,605 37,379 9,858 6,742 0 140 4,596 58,715 48,908

KarlstadBokhållaren 2 Rudsv. 12

Svarvareg. 2-4 20,602 1964 3,876 120 224 0 20 0 4,240 3,452Bokhållaren 3 Skeppareg. 5-7

Svarvareg. 6-8 28,701 1980 5,098 0 0 0 0 0 5,098 4,172Bävern 1 Östra Kanalg. 4 9,120 1967 1,695 0 0 0 107 663 2,465 1,540Glasberget 19 Karlag. 1 43,417 1970 8,389 104 0 0 0 1,501 9,994 6,897Grodan 11 Fabriksg. 3-5 8,445 1962 1,691 0 0 0 0 100 1,791 1,362

Taxable value, Value Rentable floor space revenues,Name of the property Address SEK 000s, 2002 year Housing Offices Retail Industrial Other Garage Total 2003

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Rental

•57

Grävlingen 5 Herrhagsg. 41Mellqvistg. 4 9,856 1965 1,789 65 134 0 154 545 2,687 1,793

Hjorten 7 Mellqvistg. 6-8 12,569 1966 2,522 0 0 0 0 283 2,805 2,104Jägaren 14 Drottningg. 27-33

Järnvägsg. 3 Fredsg. 4 176,736 1962/91 0 10,060 8,588 0 2,684 0 21,332 26,837

Karlsvik 1 Södra Kyrkog. 2 16,171 1960 3,203 71 0 0 0 0 3,274 2,703Krokodilen 1 Garvareg. 7

Åttkantsg. 6 23,521 1960 4,411 0 426 0 0 125 4,962 3,981Kusken 5 Kvarnbergsg. 52 14,509 1968 2,942 0 0 0 0 465 3,407 2,456Orren 24, 26 Stinsg. 1-7

Vänersg. 10-12Vikeng. 1-3 42,432 1961-62 8,410 0 23 0 0 596 9,029 7,146

Potatisen 1 Romstav. 1Solviksg. 6-32 39,411 1969 6,665 0 65 0 1,330 0 8,060 6,331

Sleipner 12 Geijersg. 4Långg. 10-16 Vasag. 5 28,083 1975 5,125 0 0 0 0 1,550 6,675 4,215

Sleipner 5 Vasag. 3 5,524 1986 894 0 62 0 0 0 956 784Staren 10 Malmtorpsg. 14

Norra Klarag. 5 10,101 1963 2,002 56 0 0 0 107 2,165 1,664Trätälja 6 Fredsg. 1 15,048 1963 1,831 385 338 0 152 680 3,386 2,695Ödlan 5 Hagag. 14-16

Garvareg. 9 38,199 1959 8,146 0 0 0 0 510 8,656 6,714Various minor properties 748 0 0 0 0 690 0 690 35

Total Karlstad 543,193 68,689 10,861 9,860 0 5,137 7,125 101,672 86,881

ÖrebroBetan 23 Malmg. 10-18 3, 088 1981 4,951 0 0 0 0 0 4,951 3,942Kråkan 20 Kristinag. 18

Engelbrektsg. 37-39Sankta Birgittag. 5-7 19,316 1940/65 2,801 293 556 0 0 0 3,650 2,853

Melonen 1 Markg. 21-23 20,013 1965 3,301 205 350 0 135 0 3,991 2,876Tulpanen 10 Ekersg. 3-7

Ringg. 22-24Angelg. 2-6 Vasatorget 4 52,390 1976 7,021 279 586 0 138 3,810 11,834 7,041

Total Örebro 124,807 18,074 777 1,492 0 273 3,810 24,426 16,712

Total Western Region 1 045,279 155,578 23,959 23,099 0 6,653 20,672 229,961 181,267

MÄLARDALEN REGION

EnköpingAlbäck 3:107 Lövstigen 1-35 5,482 1993 1,800 0 0 0 0 0 1,800 1,045Centrum 12;1, 12;6 Källg. 7

Kungsg. 25 2,287 1929 0 351 198 0 0 0 549 501Centrum 16:5 Källg. 14

Västra Ringg. 21-23 10,268 1969 171 0 2,121 0 0 401 2,693 2,350Centrum 20:1 Kryddgårdsg. 22-24

Källg. 4 Eriksg. 23 17,479 1981 1,553 2,285 0 0 85 0 3,923 3,816

Gånsta 10:2 Fannag. 28 9,834 1992 0 0 0 0 3,159 0 3,159 2,205Lillsidan 5;3. 5;4 Westerlundsg. 13 2,776 1960/64 0 146 224 0 2,429 0 2,799 751

Total Enköping 48,126 3,524 2,782 2,543 0 5,673 401 14,923 10,668

Taxable value, Value Rentable floor space revenues,Name of the property Address SEK 000s, 2002 year Housing Offices Retail Industrial Other Garage Total 2003

Rental

•58

EskilstunaFrisören 13 Norra Knoopg. 1-3

Norra Brog. 6-10 Bergsg. 12-18 Nyforsg. 19-27 54,582 1970 14,068 989 0 0 0 5,321 20,378 11,390

Hökaren 26 Rosenhällsg. 3-5Snopptorpsg. 6 21,741 1961 6,066 90 205 0 154 351 6,866 4,618

Nystanet 6 Klosterg. 2-4 Alfeltsg. 7 Strandg. 4 34,592 1963 8,562 113 889 0 0 1,538 11,102 6,897

Saxen 36 Stenkvistav. 13-19 22,844 1965 6,424 166 395 0 113 346 7,444 4,905Skräddaren 23 Andbergsg. 14 8,024 1967 2,393 0 0 0 101 184 2,678 1,739Steglitsan 9 Köpmang. 22 23,509 1981 6,267 0 0 0 0 0 6,267 4,607Stämjärnet 3 Kvarngärdesg. 10

Noreusg. 1 12,142 1949/79 3,379 0 0 0 40 0 3,419 2,484Ättlingen 4 Bruseng. 1-9

Backanäsg. 1-7 Vårgärdesg. 1-3 41,439 1967-69 18,362 557 0 0 115 809 19,843 12,900

Total Eskilstuna 218,873 65,521 1,915 1,489 0 523 8,549 77,997 49,540

KatrineholmApeln 5 Brogr. 2 11,056 1970 3,501 0 0 0 19 187 3,707 2,522Barken 9 Starrv. 4 4,474 1976 0 692 0 0 240 0 932 566Hagtornen 11 Brogr. 1 10,178 1964 3,342 0 0 0 0 336 3,678 2,395Humlen 1 Köpmang. 8 4,137 1940 834 692 170 0 239 51 1,986 1,319Hämplingen 18 Fortunag. 8-10 1967

Florag. 3-7 16,993 1969-70 5,806 65 0 0 90 0 5,961 4,014Hämplingen 3 Fortunag. 6 580 1940 224 0 0 0 0 22 246 152Linden 22 Storg. 27

Tingshusg. 4 16,604 1962 4,067 19 1,143 0 85 898 6,212 4,021Nejlikan 4 Drottningg. 7

Fredsg. 28 1,466 1939 0 0 568 0 0 0 568 300Nejlikan 16, 17 Djulög. 33-37

Drottningg. 13 17,916 1956/59 3,795 1,025 1,269 0 410 1,450 7,949 4,279Nålen 5 Blomsterv. 5-7

Tulpanv. 1-3 16,799 1966 5,857 0 0 0 94 378 6,329 4,169Oliven 3 Bondeg. 32 3,689 1975 1,148 0 0 0 0 0 1,148 807Pionen 4 Fabriksg. 4-8

Stortorget 2-6 Köpmang. 5 21,711 1992 3,158 344 1,394 0 23 1,250 6,169 4,714

Prästkragen 28 Trädgårdsg. 7-11 23,656 1967-68 7,578 37 0 0 0 664 8,279 5,463Syrenen 8 Gersnäsg. 9-13

Stensättersg. 10-20 17,494 1960 5,731 0 0 0 0 599 6,330 4,103Sädesärlan 11 Florag. 6 136 1987 0 0 0 0 0 133 133 25

Total Katrineholm 166,889 45,041 2,874 4,544 0 1,200 5,968 59,627 38,849

MotalaGarvaren 5 Kungsg. 1-3

Prästg. 6-8Bispmotalag. 6-8 44,161 1963 1,624 3,140 3,262 0 2,332 0 10,358 9,318

Repslagaren 10 Kungsg. 16-20 10,809 1965 908 73 1,387 0 0 863 3,231 2,336Tellus 1 Agneshögsg. 31-57 96,623 1969-71 36,352 188 0 0 0 1,680 38,220 22,405

Total Motala 151,593 38,884 3,401 4,649 0 2,332 2,543 51,809 34,059

Taxable value, Value Rentable floor space revenues,Name of the property Address SEK 000s, 2002 year Housing Offices Retail Industrial Other Garage Total 2003

Rental

•59

NyköpingElektrikern 1 Höglundav. 14-18 4,858 1970 1,664 0 0 0 0 0 1,664 1,234Mekanikern 1 Runebergsg. 24-38 16,615 1969 5,622 53 0 0 40 789 6,504 4,406Svarvaren 4 Höglundav. 4 2,261 1970 840 0 0 0 0 0 840 556Svetsaren 8, 9 Runebergsg. 44-50 29,437 1967-68 10,069 0 715 0 0 712 11,496 7,764

Total Nyköping 53,171 18,195 53 715 0 40 1,501 20,504 13,960Total Mälardalen Region 638,652 171,165 11,025 13,940 0 9,768 18,962 224,860 147,076

STOCKHOLM REGION

SolnaValnöten 2 Solna Strandv. 21-23

Korta Gatan 7-9 120,764 1964/87 0 12,562 0 0 309 1,300 14,171 19,379StockholmKlippan 12 Strandv. 7A

Artillerig. 2 218,068 1929 1,638 4,226 1,127 0 1,351 0 8,342 24,469Käpplingeholmen 6 Blasieholmsg. 2

Hovslagarg. 5Nybrokajen 3 401,700 1950 0 10,390 0 0 553 173 11,116 44,061

Skogsfrun 1 Strömkarlsv. 60 20,241 1965 2,426 286 0 0 0 112 2,824 2,534Sumpen 8 Kungsg. 3 111,000 1929 0 1,972 853 0 0 0 2,825 13,982Vattuormen 43 Garvareg. 9-11 70,916 1950 1,230 2,830 0 0 1,483 0 5,543 9,956

Total Stockholm 821,925 5,294 19,704 1,980 0 3,387 285 30,650 95,002

SödertäljeFasaden 5 Förvaltarv. 1,2

Skogvaktarv. 1,2 54,794 1996-97 6,629 245 2,676 0 487 2,593 12,630 8,409Gäddan 6 Värdsholmsg. 1 32,532 1978 4,674 1,045 0 0 240 2,116 8,075 5,557Kupolen 1,2,3,4,5 Förmansv. 1-3, 2-28 158,814 1968-70 35,798 0 0 0 7 3,978 39,783 28,477Petunian 1,2 ochLobelian 1 Bodast. 1-17, 2-54 219,025 1966-67 44,963 217 0 0 478 4,284 49,942 35,134Tulpanen 1 Syreng. 6-10 9,505 1970 1,983 0 0 0 0 0 1,983 1,592Vinkeln 5 Torekällg. 36-38 8,315 1968 1,752 0 0 0 0 195 1,947 1,407

Total Södertälje 482,985 95,799 1,507 2,676 0 1,212 13,166 114,360 80,576

UppsalaDragarbrunn 10:3 Svartbäcksg. 12-14

Klosterg. 4 Östra Åg. 9-11S:t Olofsg. 9-11 121,549 1960/65 2,930 6,359 4,120 0 1,330 2,360 17,099 17,615

Total Stockholm Region 1,547,223 104,023 40,132 8,776 0 6,238 17,111 176,280 212,572

GOTHENBURG REGION

GothenburgGårda 8:6 Anders Perssonsg. 18

Källhusg. 3 70,478 1973 0 9,304 137 0 170 2,800 12,411 12,285Krokslätt 149:16 Mölndalsv. 22-34 213,530 1989/92 0 21,269 1,423 0 297 5,904 28,893 30,964Stampen 9:31 Färgareg. 6-10

Stampg. 28-34Folkungag. 15-17 251,713 1974-75 5,791 19,986 0 0 3,636 2,048 31,461 35,103

Älvsborg 32:98 Lavettg. 11 1,844 1929 175 0 0 0 0 0 175 0

Total Gothenburg 537,565 5,966 50,559 1,560 0 4,103 10,752 72,940 78,352

LandskronaBromsregulatorn 1 Instrumentg. 15 50,352 1968/96 0 0 0 31 938 0 0 31,938 17,772

Total Gothenburg Region 587,917 5,966 50,559 1,560 31 938 4,103 10,752 104,878 96,124

Total all regions 4,882,923 547,697 162,782 87,689 46 957 51,197 109,615 1,005,937 845,475

Taxable value, Value Rentable floor space revenues,Name of the property Address SEK 000s, 2002 year Housing Offices Retail Industrial Other Garage Total 2003

Rental

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Board of DirectorsPer WelinBorn 1936Licentiate in Engineering. Chairman. Elected tothe Board 1990. Board member of Allgon,Autoliv and Holmen, among others. Number of shares (incl. companies): 40,000.

Lennart BylockBorn 1940Elected to the Board 1997. Chairman ofCellMark and Swede Ship Marine. Board mem-ber of Cloetta Fazer and the Swedish Nature andCulture Foundation. Number of shares: 35,000.

Michael KnutssonBorn 1957Employee representative, SIF (the SwedishIndustrial Salaried Employees’ Association).Elected to the Board 2000. Number of shares: 300.

Ulf LundahlBorn 1952Elected to the Board 2001. Number of shares: 10,000.

Fredrik LundbergBorn 1951Doctor of Economics. President and ChiefExecutive Officer of Lundbergs. Elected to theBoard 1975. Chairman of Cardo, Holmen andHufvudstaden. Board member of SvenskaHandelsbanken, NCC and Stadium. Number of shares (including companies):32,250,047.

Christer NöjdBorn 1959Employee representative, LO (the SwedishConfederation of Trade Unions). Elected to theBoard 1997.

Sten PetersonBorn 1956Elected to the Board 2001. Number of shares: 2,500.

Bengt PetterssonBorn 1938Elected to the Board 1999. Board member ofCardo and Holmen. Number of shares: 1,000.

Christer ZetterbergBorn 1941Elected to the Board 1990. Chairman of D.Carnegie & Co and Forssjö Bruk. Board memberof Holmen and Micronic Laser Systems, amongother companies. Vice President of the SwedishAcademy of Engineering Sciences. Number of shares: 5,000.

DEPUTIES

Nils SvanbergBorn 1968Employee representative, LO. Elected to theBoard 1999.

Kaj-Åke ThorvaldsonBorn 1943Employee representative, SIF. Elected to theBoard 1995. Number of shares: 400.

Michael Knutsson Nils Svanberg Christer Zetterberg

Bengt Pettersson

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Sten Peterson Lennart Bylock Ulf Lundahl Kaj-Åke Thorvaldson Christer Nöjd

Per Welin Fredrik Lundberg

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Senior executives Fredrik LundbergBorn 1951, employed since 1977. Presidentand Chief Executive Officer. Number of shares(including companies): 32,250,047.

Claes BoustedtBorn 1962, employed since 1991. ExecutiveVice President, President of L E LundbergKapitalförvaltning AB.

Bernt-Olof JalknerBorn 1942, employed since 1989. ExecutiveVice President, Chief Financial Officer.

Ingvar NordénBorn 1943, employed since 1992. ExecutiveVice President, Head of DevelopmentProperties. Number of shares: 500.

Roger EkströmBorn 1961, employed since 2001. Information Manager.

Bertil EskilstorpBorn 1936, employed since 1970. Regional Manager, Gothenburg. Number of shares: 1,000.

Lars KlintBorn 1946, employed since 1970. Regional Manager, Stockholm.

Peter Landin Born 1963, employed since 1995. Regional Manager, Mälardalen.

Dag Sundqvist Born 1945, employed since 1968. Regional Manager, Western Sweden. Number of shares: 600.

Lars SvenssonBorn 1958, employed since 1999. Regional Manager, Eastern Sweden.

Bo WaldemarsonBorn 1938, employed since 1961. Vice President.

Peter WhassBorn 1954, employed since 1989. Head of Real Estate.

AuditorsBo RibersBorn 1942. Authorized Public AccountantKPMG.

Hans WilhelmssonBorn 1944. Authorized Public AccountantKPMG.

DEPUTY AUDITORS

Carl LindgrenBorn 1958. Authorized Public AccountantKPMG.

Hans ÅkervallBorn 1953. Authorized Public AccountantKPMG. Bertil Eskilstorp Lars Klint

Peter Whass Fredrik Lundberg

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Bernt-Olof Jalkner

Bo Waldemarson

Roger Ekström

Claes Boustedt

Ingvar Nordén

Dag Sundqvist

Lars Svensson

Peter Landin

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Addresses

www.lundbergs.seOn Lundbergs’ website, you will find generalinformation about the Company, financialinformation and the current share price. Thereare also links to the companies in whichLundbergs has major shareholdings. You canalso visit the individual companies’ own websitesdirectly, as follows:www.cardo.sewww.holmen.comwww.hufvudstaden.sewww.industrivarden.sewww.ncc.sewww.stadium.se

L E Lundbergföretagen AB (publ) Fastighets AB L E Lundberg (publ) L E Lundberg Kapitalförvaltning ABCorp Reg No: 556056-8817 Corp Reg No: 556049-0483 Corp Reg No: 556188-2290Registered headquarters: Stockholm L E Lundbergföretagen AB (publ) PO Box 14048, 104 40 StockholmPO Box 14048, 104 40 Stockholm 601 85 Norrköping Street address Hovslagargatan 5 BStreet address Hovslagargatan 5 B Street address S:t Persgatan 105 Tel:+46-8-463 06 00 Tel:+46-8- 463 06 00 Tel:+46-11-21 65 00 Fax:+46-8-611 38 76Fax:+46-8- 611 66 09 Fax:+46-11-10 44 17 E-mail: analys@lundbergs.seE-mail: lundbergs@lundbergs.se Fax:+46-11-21 65 65

E-mail: lundbergs@lundbergs.se

Gothenburg regionFastighets AB L E Lundberg (publ)Mölndalsvägen 26412 63 GothenburgTel:+46-31-83 07 35 Fax 031-83 18 24E-mail: goteborg@lundbergs.se

Mälardalen regionFastighets AB L E Lundberg (publ)Västra Åsgatan 1632 25 EskilstunaTel:+46-16-16 60 00 Fax 016-51 13 47E-mail: eskilstuna@lundbergs.se

Stockholm regionFastighets AB L E Lundberg (publ)PO Box 14048, 104 40 StockholmStreet address Hovslagargatan 5 BTel 08-463 06 00Fax 08-679 55 33 E-mail: stockholm@lundbergs.se

Western regionFastighets AB L E Lundberg (publ)Drottninggatan 27652 25 KarlstadTel:+46-54-15 67 55Fax:+46-54-15 87 90E-mail: karlstad@lundbergs.seRegion

Eastern regionFastighets AB L E Lundberg (publ)601 85 NorrköpingStreet address S:t Persgatan 105Tel 011-21 65 00Fax 011-10 44 17E-mail: norrkoping@lundbergs.se

Shareholders in L E LundbergföretagenAB (publ) are hereby summoned tothe Annual General Meeting to beheld on Thursday, April 3, 2003, at4.00 p.m. in the World Trade Center,Klarabergsviadukten 70, Stockholm,Sweden.

Notification and registrationShareholders wishing to participatein the business of the Meeting shallbe recorded in the Securities

Register maintained by VPC (Swedish Securities Registry Center) no later than Monday, March 24, 2003,

and notify the Company of their intention to participate no later than noon, Friday, March 28, 2003 at the following address:

Notifications can be made in any ofthe following manners:• By post to L E LundbergföretagenAB (publ), S-601 85 Norrköping,Sweden• by telephone to Int. +46-11-21 6500• by telefax to Int. +46-11-21 65 65,or • by e-mail to siv.pettersson@lund-bergs.se

Notifications must include details ofthe shareholder’s name, address,telephone number, personal identifi-cation/corporate registration numberand number of shares held. If partici-pation is to be based on proxy, theproxy document must be sent to theCompany before the Annual GeneralMeeting.

To be able to vote at the Meeting,shareholders whose shares areregistered in a nominee’s name,through a bank’s trust department oran individual broker, must tempora-rily register their shares in their ownnames. Such registration must becompleted by Monday, March 24,2003. This means the nominee mustbe given adequate notice of the sha-reholder’s wishes before this date.

Financial informationThe following financial reports willbe published in Swedish and Englishon our website:

Interim Report, January-March 2003May 13, 2003

Interim Report, January-June 2003August 22, 2003

Interim Report, January-September2003 November 12, 2003

Year-end Report 2003 February2004

The Annual Report will be sent toshareholders who have notified VPCthat they wish to receive it.

Form och produktion: Wildell Integrerad Kommunikation ABText: LundbergsTryck och repro: Redners Offsettryckeri ABPapper: Omslag Silverblade Silk 250 g, Inlaga Silverblade Silk 150 gFoto: Dag Sundberg: sid 4, 18, 22, 24, 26, 28, 30, 60–61, 62–63Nino Monastra: sid 12–14, 17, 32, 54–59Tryckdatum: 17 mars 2003

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