Stock Analysis on Net

Caterpillar Inc. (NYSE:CAT)

Analysis of Property, Plant and Equipment

Microsoft Excel

Property, Plant and Equipment Disclosure

Caterpillar Inc., balance sheet: property, plant and equipment

US$ in millions

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Land 616 622 648 681 664
Buildings and land improvements 7,154 7,016 7,113 7,091 6,710
Machinery, equipment and other 12,150 12,282 12,868 13,004 13,287
Software 1,607 1,556 1,697 1,679 1,728
Equipment leased to others 5,837 5,568 5,733 6,077 6,208
Construction-in-process 1,259 1,020 812 739 620
Property, plant and equipment, at cost 28,623 28,064 28,871 29,271 29,217
Accumulated depreciation (15,943) (16,036) (16,781) (16,870) (16,313)
Property, plant and equipment, net 12,680 12,028 12,090 12,401 12,904

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Item Description The company
Property, plant and equipment, at cost Amount before accumulated depreciation, depletion and amortization of physical assets used in the normal conduct of business and not intended for resale. Examples include, but are not limited to, land, buildings, machinery and equipment, office equipment, and furniture and fixtures. Caterpillar Inc. property, plant and equipment, at cost decreased from 2021 to 2022 but then increased from 2022 to 2023 not reaching 2021 level.
Property, plant and equipment, net Amount after accumulated depreciation, depletion and amortization of physical assets used in the normal conduct of business to produce goods and services and not intended for resale. Examples include, but are not limited to, land, buildings, machinery and equipment, office equipment, and furniture and fixtures. Caterpillar Inc. property, plant and equipment, net decreased from 2021 to 2022 but then increased from 2022 to 2023 exceeding 2021 level.

Asset Age Ratios (Summary)

Caterpillar Inc., asset age ratios

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Average age ratio 56.93% 58.44% 59.46% 59.01% 57.13%
Estimated total useful life (years) 15 14 14 13 13
Estimated age, time elapsed since purchase (years) 8 8 8 8 7
Estimated remaining life (years) 6 6 6 6 5

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Asset age ratio Description The company
Average age ratio As long as straight-line depreciation is used, this is an accurate estimate of asset age as a percentage of depreciable life. The relative age is a useful measure of whether the company fixed asset base is old or new. Newer assets are likely to be more efficient. Caterpillar Inc. average age ratio of depreciable property, plant and equipment improved from 2021 to 2022 and from 2022 to 2023.
Estimated total useful life Over longer time periods, this ratio is a useful measure of company depreciation policy and can be used for comparisons with competitors. Caterpillar Inc. estimated total useful life of depreciable property, plant and equipment increased from 2021 to 2022 and from 2022 to 2023.
Estimated time elapsed since purchase The approximate age in years of a company fixed assets. Useful for comparison purposes. Caterpillar Inc. estimated time elapsed since purchase of depreciable property, plant and equipment deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023.
Estimated remaining life Caterpillar Inc. estimated remaining life of depreciable property, plant and equipment increased from 2021 to 2022 and from 2022 to 2023.

Average Age

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Selected Financial Data (US$ in millions)
Accumulated depreciation 15,943 16,036 16,781 16,870 16,313
Property, plant and equipment, at cost 28,623 28,064 28,871 29,271 29,217
Land 616 622 648 681 664
Asset Age Ratio
Average age1 56.93% 58.44% 59.46% 59.01% 57.13%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 Average age = 100 × Accumulated depreciation ÷ (Property, plant and equipment, at cost – Land)
= 100 × 15,943 ÷ (28,623616) = 56.93%

Asset age ratio Description The company
Average age As long as straight-line depreciation is used, this is an accurate estimate of asset age as a percentage of depreciable life. The relative age is a useful measure of whether the company fixed asset base is old or new. Newer assets are likely to be more efficient. Caterpillar Inc. average age ratio of depreciable property, plant and equipment improved from 2021 to 2022 and from 2022 to 2023.

Estimated Total Useful Life

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Selected Financial Data (US$ in millions)
Property, plant and equipment, at cost 28,623 28,064 28,871 29,271 29,217
Land 616 622 648 681 664
Consolidated depreciation expense 1,929 1,937 2,050 2,122 2,253
Asset Age Ratio (Years)
Estimated total useful life1 15 14 14 13 13

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 Estimated total useful life = (Property, plant and equipment, at cost – Land) ÷ Consolidated depreciation expense
= (28,623616) ÷ 1,929 = 15

Asset age ratio Description The company
Estimated total useful life Over longer time periods, this ratio is a useful measure of company depreciation policy and can be used for comparisons with competitors. Caterpillar Inc. estimated total useful life of depreciable property, plant and equipment increased from 2021 to 2022 and from 2022 to 2023.

Estimated Age, Time Elapsed since Purchase

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Selected Financial Data (US$ in millions)
Accumulated depreciation 15,943 16,036 16,781 16,870 16,313
Consolidated depreciation expense 1,929 1,937 2,050 2,122 2,253
Asset Age Ratio (Years)
Time elapsed since purchase1 8 8 8 8 7

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 Time elapsed since purchase = Accumulated depreciation ÷ Consolidated depreciation expense
= 15,943 ÷ 1,929 = 8

Asset age ratio Description The company
Estimated time elapsed since purchase The approximate age in years of a company fixed assets. Useful for comparison purposes. Caterpillar Inc. estimated time elapsed since purchase of depreciable property, plant and equipment deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023.

Estimated Remaining Life

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Selected Financial Data (US$ in millions)
Property, plant and equipment, net 12,680 12,028 12,090 12,401 12,904
Land 616 622 648 681 664
Consolidated depreciation expense 1,929 1,937 2,050 2,122 2,253
Asset Age Ratio (Years)
Estimated remaining life1 6 6 6 6 5

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 Estimated remaining life = (Property, plant and equipment, net – Land) ÷ Consolidated depreciation expense
= (12,680616) ÷ 1,929 = 6

Asset age ratio Description The company
Estimated remaining life Caterpillar Inc. estimated remaining life of depreciable property, plant and equipment increased from 2021 to 2022 and from 2022 to 2023.