Amgen Inc. (NASDAQ:AMGN)

The financial data for property, plant, and equipment over the five-year period reveals consistent growth across most asset categories, reflecting ongoing investment and expansion activities.

Land

The value of land shows a steady increase from $259 million in 2020 to $346 million in 2024. This growth indicates acquisitions or revaluations contributing to incremental asset base enhancement.

Buildings and improvements

Buildings and improvements exhibit continuous growth, increasing from $3,857 million to $4,803 million over the period. This upward trend suggests sustained capital expenditure in structural assets, likely supporting operational capacity expansion.

Manufacturing equipment

The value of manufacturing equipment rises moderately from $2,865 million in 2020 to $3,291 million in 2024. The modest increase points to ongoing upgrades or additions aligned with production needs.

Laboratory equipment

Laboratory equipment fluctuates slightly, declining from $1,257 million in 2020 to $1,193 million in 2021, followed by gradual increases to reach $1,345 million in 2024. This pattern may reflect replacement cycles or investments in research-related assets.

Fixed equipment

Fixed equipment remains relatively stable, with minor growth from $2,406 million to $2,592 million. The minimal changes indicate limited expansion or consistent maintenance investment.

Capitalized software

Capitalized software decreases slightly from $1,216 million in 2020 to $1,151 million in 2021, then increases steadily to $1,442 million in 2024. This suggests initial amortization offset by substantial new software capitalization in later years.

Other assets

The "Other" category declines significantly from $1,091 million in 2020 to $862 million in 2021, with gradual increases thereafter to $1,059 million by 2024. This variability may indicate asset reclassifications or disposals followed by new acquisitions.

Construction in progress

Construction in progress demonstrates strong growth from $915 million to $2,053 million, more than doubling over five years. This indicates active investment in new facilities or major asset upgrades under development.

Property, plant and equipment, gross

The gross property, plant and equipment balance grows steadily from $13,866 million to $16,931 million, affirming consistent asset accumulation and capital expenditure.

Accumulated depreciation and amortization

Accumulated depreciation and amortization increases in absolute terms from -$8,977 million to -$10,388 million, reflecting ongoing asset usage and the aging of the asset base.

Property, plant and equipment, net

Net property, plant and equipment rises from $4,889 million in 2020 to $6,543 million in 2024, driven by gross asset increases that outpace accumulated depreciation. This positive net asset growth supports a strong operational asset position.

Overall, the data reveals an ongoing investment trend with notable increases in construction in progress and buildings, signaling capacity expansion. Depreciation levels rise as expected, yet net assets maintain a clear upward trajectory, indicating sustained enhancement of the long-term asset base.

Average Age Ratio

The average age ratio shows a consistent downward trend from 65.97% in 2020 to 62.63% in 2024. This decline indicates a gradual rejuvenation of the property, plant, and equipment assets, suggesting that newer assets are being added or that older assets are being retired or replaced over the period.

Estimated Total Useful Life

This metric remains steady at 21 years during 2020 and 2021, followed by a slight increase to 22 years in 2022 and 2023, and further rising to 24 years in 2024. This upward shift implies a reassessment or extension in the expected useful lifespan of assets, potentially reflecting improvements in asset quality or changes in accounting estimates.

Estimated Age, Time Elapsed Since Purchase

The estimated asset age remains constant at 14 years from 2020 through 2023, increasing slightly to 15 years in 2024. This suggests that while assets have aged consistently, the cumulative age of the asset base did not increase materially until 2024, signaling possible acquisitions or disposals affecting the asset mix.

Estimated Remaining Life

The remaining life of assets shows an increase from 7 years in 2020 to 8 years in 2021, maintaining at 8 years through 2023, and then extending to 9 years in 2024. The growth in remaining useful life complements the reported increase in total useful life, indicating enhancements in asset longevity or revisions in asset management strategies.

Property, Plant, and Equipment (Gross)

The gross value of property, plant, and equipment increased consistently over the five-year period, rising from $13,866 million at the end of 2020 to $16,931 million by the end of 2024. This upward trend indicates ongoing investments and additions to the company's physical assets.

Accumulated Depreciation and Amortization

Accumulated depreciation and amortization exhibited a generally increasing trend, growing from $8,977 million in 2020 to $10,388 million in 2024. A slight dip occurred between 2020 and 2021, where the figure declined from $8,977 million to $8,798 million, but thereafter, the balance steadily increased each year. This pattern reflects the aging and usage of assets, as well as the depreciation expenses recorded over time.

Land

The value of land recorded a steady increase throughout the examined period, starting at $259 million in 2020 and rising to $346 million by 2024. This gradual increase suggests acquisitions or revaluations of land assets, contributing to the overall growth in fixed assets.

Average Age Ratio

The average age ratio, expressed as a percentage, showed a gradual decline from 65.97% in 2020 to 62.63% in 2024. This decreasing trend may imply that newer assets have been added to the portfolio, thereby lowering the overall average age of the assets. A lower average age ratio typically signals a fresher asset base which could have implications for maintenance costs and operational efficiency.

Overall Interpretation

The data indicate a pattern of consistent investment in property, plant, and equipment, as evidenced by the steady increase in gross asset values. The corresponding increase in accumulated depreciation aligns with asset aging and usage, though the slightly decreasing average age ratio points toward a balance between older and newer asset acquisitions. The rise in land value further supports the notion of expansion or asset enhancement strategies. Taken together, these trends suggest a stable asset management approach with ongoing capital expenditures and renewal.

Property, plant and equipment, gross

The gross value of property, plant, and equipment exhibited a consistent upward trend over the five-year period. Beginning at $13,866 million at the end of 2020, it increased steadily each year, reaching $16,931 million by the end of 2024. This represents an approximate overall growth of 22% across the span, indicating ongoing capital investments or asset additions.

Land

The recorded value of land showed a gradual increase from $259 million in 2020 to $346 million in 2024. The growth was relatively moderate but steady year-over-year, suggesting incremental acquisitions or revaluations of land assets during the period.

Depreciation and amortization expense associated with property, plant and equipment

This expense category demonstrated a slight but consistent rise each year, increasing from $640 million in 2020 to $694 million in 2024. The moderate increase aligns with the expanded value of fixed assets, reflecting ongoing depreciation of an expanding asset base.

Estimated total useful life

The estimated useful life of the property, plant, and equipment showed a slight upward adjustment over the reported years, from 21 years in 2020 and 2021 to 24 years by 2024. This trend may reflect changes in asset composition, improved asset quality, or reassessments extending the expected utility of the assets.

Accumulated Depreciation and Amortization

The accumulated depreciation and amortization values show a generally increasing trend over the five-year period. Beginning at 8,977 million USD in 2020, the figure dips slightly to 8,798 million USD in 2021, but then increases consistently each subsequent year, reaching 10,388 million USD in 2024. This upward movement suggests ongoing recognition of depreciation expenses, reflecting the aging of property, plant, and equipment assets or continued capital expenditures being amortized.

Depreciation and Amortization Expense

The annual depreciation and amortization expense related to property, plant, and equipment exhibits a gradual increase over the observed years. Starting at 640 million USD in 2020, it rises modestly to 694 million USD by 2024. This steady increase may indicate either incremental additions to depreciable assets or adjustments in depreciation methods or estimates, but overall it reflects consistent expense recognition in line with asset usage or value consumption.

Time Elapsed Since Purchase

The metric capturing the time elapsed since purchase of the assets remains relatively constant at 14 years from 2020 through 2023 and increases to 15 years in 2024. This stability, with just a one-year increment in the final period, implies that the core asset base is relatively mature with limited rapid turnover or significant new asset acquisitions altering the average age of property, plant, and equipment.

Overall Insights

The combined data points suggest a mature asset base with a consistent approach to asset depreciation. The steady increase in accumulated depreciation aligns with the moderate rise in annual depreciation expense, indicating disciplined financial reporting and asset management. The relative steadiness in the time elapsed metric further supports an interpretation of limited major asset renewals or replacements during this period, implying a focus on managing and utilizing existing assets efficiently.

Property, Plant and Equipment, Net

The net value of property, plant, and equipment shows a consistent upward trend from 2020 to 2024. Starting at US$4,889 million in 2020, it increases steadily each year, reaching US$6,543 million by the end of 2024. This represents a cumulative increase of approximately 34% over the five-year period, indicating ongoing investment or capital expenditure in fixed assets.

Land

The value of land also exhibits a positive trend, rising from US$259 million in 2020 to US$346 million in 2024. The increase is more moderate compared to the overall property, plant, and equipment, but still reflects an expansion in land holdings or appreciation in land value by roughly 34% over the period.

Depreciation and Amortization Expense Associated with Property, Plant and Equipment

The depreciation and amortization expense shows a gradual increase from US$640 million in 2020 to US$694 million in 2024. The growth over five years is relatively modest (about 8.4%), suggesting stable asset utilization and consistent expense recognition practices despite the rising asset base.

Estimated Remaining Life

The estimated remaining life of property, plant, and equipment remains fairly stable, fluctuating slightly but generally staying around 7 to 9 years throughout the period. A small increase to 9 years in 2024 may reflect extensions in asset useful life estimates or additions of longer-lived assets.