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15 Inventories

Composition of inventories and other financial information

(In € million)

 

As of
31 Dec. 2021

 

As of
31 Dec. 2020

Raw materials and consumables

 

71.2

 

50.0

Work in progress

 

22.6

 

21.0

Finished goods

 

100.7

 

99.7

Total inventories

 

194.5

 

170.7

The increase in inventories since 31 December 2020 is impacted by the full consolidation of the former joint ventures in the Middle East in 2021.

As of 31 December 2021, inventories include a provision of €20.5 million due to write-downs to net realisable value (€15.5 million as of 31 December 2020).

Raw materials and consumables recognised as an expense in cost of sales in the statement of profit or loss and other comprehensive income amount to €856.5 million in the year ended 31 December 2021 (€727.4 million in the year ended 31 December 2020).

Spare parts in the amount of €5.4 million related to production equipment of the Group’s paper mill in New Zealand were impaired and recognised as an expense in cost of sales in the statement of profit or loss and other comprehensive income in the year ended 31 December 2020. See note 12.

Accounting policy

Inventories are measured at the lower of cost and net realisable value. The cost of inventories is based on the weighted average cost formula and includes costs incurred in acquiring the inventories and bringing them to their present location and condition. In the case of manufactured inventories and work in progress, cost includes an appropriate share of production overheads based on normal operating capacity. Net realisable value is the estimated selling price less the estimated costs of completion and estimated costs necessary to make the sale.