Table:
| Capital expenditures 2017–2019 |  |  |  |
| --- | --- | --- | --- |
| SEK billion | 2019 | 2018 | 2017 |
| Capital expenditures | 5.1 | 4.0 | 3.9 |
| Of which in Sweden | 2.0 | 1.3 | 1.5 |
| Share of annual sales | 2.3% | 1.9% | 1.9% |
Paragraphs:
Capital expenditures
For 2019, capital expenditure was SEK 5.1 (4.0) billion, representing 2.3% of sales. Expenditures are largely related to test sites and equipment for R&D, network operation centers and manufacturing and repair operations.
The increase in 2019 was mainly due to investments in 5G test equipment.
Annual capital expenditures are normally around 2% of sales. This corresponds to the needs for keeping and maintaining the current capacity level. The Board of Directors reviews the Company’s investment plans and proposals.
As of December 31, 2019, no material land, buildings, machinery or equipment were pledged as collateral for outstanding indebtedness.
Question:
Why was there an increase in capital expenditure in 2019?
Answer: investments in 5G test equipment