Analysis of Property, Plant and Equipment
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- Cash Flow Statement
- Common-Size Income Statement
- Present Value of Free Cash Flow to Equity (FCFE)
- Net Profit Margin since 2005
- Current Ratio since 2005
- Price to Earnings (P/E) since 2005
- Price to Operating Profit (P/OP) since 2005
- Price to Sales (P/S) since 2005
- Analysis of Revenues
- Aggregate Accruals
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Property, Plant and Equipment Disclosure
Express Scripts Holding Co., balance sheet: property, plant and equipment
US$ in thousands
Based on: 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31).
- Land and Buildings
- The value of land and buildings exhibited a fluctuating trend over the five-year period. It initially increased slightly from 215,800 thousand US dollars in 2013 to 224,000 thousand in 2014, followed by a decline to 200,000 thousand in 2015. The downward movement continued with a reduction to 184,700 thousand in 2016, but there was a moderate recovery to 195,300 thousand by the end of 2017.
- Furniture
- Furniture values remained relatively stable across the years, fluctuating marginally between 71,400 thousand and 74,500 thousand US dollars. The minimal variations suggest consistent investment or maintenance levels in this category.
- Equipment
- Equipment values increased from 707,500 thousand US dollars in 2013 to a peak of 801,400 thousand in 2016. However, a significant decrease occurred in 2017, falling to 543,500 thousand. This notable drop indicates possible disposals, write-downs, or changes in accounting treatment of equipment assets.
- Computer Software
- The value attributed to computer software demonstrated a steady upward trajectory from 1,582,300 thousand US dollars in 2013 to 1,926,000 thousand in 2016. No data is available for 2017, which limits analysis for the final year; however, the established trend suggests sustained or increasing capitalization of software development costs until 2016.
- Leasehold Improvements
- Leasehold improvements consistently increased each year, starting at 173,400 thousand US dollars in 2013 and rising to 290,800 thousand in 2017. This steady growth reflects ongoing investments or upgrades in leased properties.
- Property and Equipment, Gross
- The gross property and equipment balance showed a gradual increase from 2,750,600 thousand US dollars in 2013 to 3,223,000 thousand in 2016. However, there was a dramatic decline to 1,104,100 thousand in 2017, corresponding with the large decreases observed in equipment and the absence of computer software data for that year. This sharp reduction suggests major asset disposals, reclassifications, or changes in reporting methodology.
- Accumulated Depreciation
- Accumulated depreciation consistently increased in magnitude (more negative) from -1,091,700 thousand US dollars in 2013 to -1,949,400 thousand in 2016, reflecting continued depreciation expense over time. In 2017, there was a significant reduction to -552,800 thousand, coinciding with the reduction in gross property and equipment. This change could indicate asset retirements or a revision in accumulated depreciation recording.
- Property and Equipment, Net
- Net property and equipment declined steadily from 1,658,900 thousand US dollars in 2013 to 1,273,600 thousand in 2016. A marked decrease occurred in 2017, with the net balance dropping to 551,300 thousand. This substantial reduction aligns with the sharp decreases in gross assets and accumulated depreciation, suggesting significant asset disposals, impairments, or changes in asset classification during 2017.
Asset Age Ratios (Summary)
Express Scripts Holding Co., asset age ratios
Based on: 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31).
- Average Age Ratio
- The average age ratio exhibited an overall increasing trend from 39.69% in 2013 to a peak of 60.48% in 2016, indicating the property, plant, and equipment (PP&E) assets were aging as a proportion of their estimated useful lives. However, in 2017, the ratio decreased notably to 50.07%, suggesting some renewal or replacement activity occurred, thereby reducing the relative age of the asset base.
- Estimated Total Useful Life
- The estimated total useful life of the assets showed considerable variability. It remained stable at 6 years for 2013 and 2014 but dropped to 5 years in 2015, then sharply increased to 10 years in 2016 before settling at 8 years in 2017. This fluctuation reflects changes in asset composition or valuation policies, impacting depreciation estimates and asset management strategies.
- Estimated Age, Time Elapsed Since Purchase
- The estimated age of assets was consistent at 3 years from 2013 to 2015, indicating a static average age of acquisitions during this period. In 2016, the estimated age doubled to 6 years, suggesting a period with fewer new acquisitions or extensions of asset lives. In 2017, the estimated age decreased to 4 years, which may indicate renewed asset purchases or disposals of older assets.
- Estimated Remaining Life
- The estimated remaining life showed a generally decreasing trend from 4 years in 2013 to 2 years in 2015, reflecting aging assets nearing the end of their useful life. Subsequently, it increased to 4 years in 2016 and maintained this level in 2017, which corresponds with the observed increase in total useful life and signals asset reinvestment or revaluation extending the remaining service period.
Average Age
| Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | Dec 31, 2013 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Accumulated depreciation | ||||||
| Property and equipment, gross | ||||||
| Asset Age Ratio | ||||||
| Average age1 | ||||||
Based on: 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31).
2017 Calculations
1 Average age = 100 × Accumulated depreciation ÷ Property and equipment, gross
= 100 × ÷ =
The financial data on property, plant, and equipment demonstrates several notable trends over the five-year period.
- Accumulated Depreciation
- From 2013 through 2016, accumulated depreciation shows a steady increase each year, rising from 1,091,700 thousand USD in 2013 to 1,949,400 thousand USD in 2016. This growth suggests ongoing usage and aging of assets over time. However, in 2017, there is a marked decrease in accumulated depreciation to 552,800 thousand USD, which is a significant deviation from the prior upward trend.
- Property and Equipment, Gross
- The gross value of property and equipment progresses upward consistently from 2,750,600 thousand USD in 2013 to 3,223,000 thousand USD by the end of 2016, reflecting expansion or reinvestment in fixed assets. In 2017, a sharp decline to 1,104,100 thousand USD occurs, reversing this growth trend and representing a substantial reduction in gross asset base.
- Average Age Ratio
- The average age ratio, expressed as a percentage, increases from 39.69% in 2013 to a peak of 60.48% in 2016, indicating that the asset base is aging over this timeframe. In 2017, this ratio decreases to 50.07%, suggesting a rejuvenation or replacement of assets, consistent with the significant changes observed in accumulated depreciation and gross property and equipment values during that year.
Overall, the data from 2013 to 2016 indicates a period of asset accumulation and aging, with steady increases in both the gross property and equipment values and accumulated depreciation, alongside an increasing average age ratio. The year 2017 presents a distinct shift, characterized by a marked reduction in the gross asset amount and accumulated depreciation, accompanied by a lower average age ratio. This likely indicates a disposal of older assets or a strategic asset replacement program occurring in 2017, which significantly altered the composition and average age of the property, plant, and equipment portfolio.
Estimated Total Useful Life
Based on: 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31).
2017 Calculations
1 Estimated total useful life = Property and equipment, gross ÷ Depreciation expense
= ÷ =
The data presents an overview of property, plant, and equipment values and related depreciation metrics over a five-year period.
- Property and Equipment, Gross
- The gross value shows an overall decreasing trend. It increased modestly from 2,750,600 thousand US$ in 2013 to a peak of 3,223,000 thousand US$ in 2016, then sharply declined to 1,104,100 thousand US$ by the end of 2017. This notable drop in the last year may indicate asset disposals, reclassification, or impairment.
- Depreciation Expense
- Depreciation expense generally increased from 428,800 thousand US$ in 2013 to a peak of 628,200 thousand US$ in 2015, reflecting either increased asset base or accelerated depreciation methods. However, it sharply declined to 321,800 thousand US$ in 2016 and further to 134,600 thousand US$ in 2017, consistent with the reduction in gross property and equipment values.
- Estimated Total Useful Life
- The estimated total useful life of the assets shows variability, starting at 6 years in 2013 and 2014, decreasing to 5 years in 2015, then increasing substantially to 10 years in 2016 and slightly reducing to 8 years in 2017. This suggests a change in asset composition or reassessment of asset longevity, potentially reflecting newer, longer-lived assets or revised depreciation policies.
Overall, the data indicates that the company experienced growth in its property and equipment until 2016 followed by a significant asset reduction in 2017. The depreciation expenses correlate with the asset values and useful life changes, showing a shift possibly due to changes in asset mix or accounting estimates.
Estimated Age, Time Elapsed since Purchase
Based on: 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31).
2017 Calculations
1 Time elapsed since purchase = Accumulated depreciation ÷ Depreciation expense
= ÷ =
- Accumulated Depreciation
- The accumulated depreciation increased consistently from 1,091,700 thousand USD at the end of 2013 to 1,949,400 thousand USD by the end of 2016, indicating ongoing depreciation of property, plant, and equipment. However, there was a significant decrease to 552,800 thousand USD in 2017, which could suggest a major asset disposal, revaluation, or change in accounting policy related to depreciation.
- Depreciation Expense
- The annual depreciation expense rose from 428,800 thousand USD in 2013 to a peak of 628,200 thousand USD in 2015, reflecting increased depreciation charges possibly due to new asset acquisitions or accelerated depreciation methods. Subsequently, depreciation expense declined sharply to 321,800 thousand USD in 2016 and further to 134,600 thousand USD in 2017, aligning with the drop in accumulated depreciation and suggesting reduced depreciation impact or asset base.
- Time Elapsed Since Purchase
- The average time elapsed since purchase remained steady at 3 years for the first three years (2013-2015), then increased to 6 years in 2016 before decreasing to 4 years in 2017. This indicates that the age of the asset base increased in 2016, possibly due to fewer new acquisitions or retention of older assets, followed by acquisition or replacement of assets by 2017 that lowered the average age.
Estimated Remaining Life
Based on: 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31).
2017 Calculations
1 Estimated remaining life = Property and equipment, net ÷ Depreciation expense
= ÷ =
- Property and Equipment, Net
- The net value of property and equipment shows a consistent downward trend over the five-year period, declining from $1,658,900 thousand at the end of 2013 to $551,300 thousand by the end of 2017. The most significant decreases occur between 2015 and 2017, indicating substantial asset disposals, impairments, or accelerations in depreciation.
- Depreciation Expense
- Depreciation expense fluctuates notably during the period. It initially increases from $428,800 thousand in 2013 to a peak of $628,200 thousand in 2015, followed by a sharp decrease to $134,600 thousand by 2017. This pattern suggests that the company accelerated depreciation or recognized higher depreciation charges earlier in the period, and then significantly reduced these charges towards the end, likely reflecting reduced asset base or changes in depreciation policy.
- Estimated Remaining Life
- The estimated remaining life of property and equipment starts at 4 years in 2013, decreases to 2 years by 2015, and returns to 4 years in 2016 and 2017. This indicates that earlier assets were nearing the end of their useful lives around 2015, potentially contributing to the high depreciation expense observed at that time. The subsequent increase back to 4 years aligns with the reduced asset base, possibly reflecting newer assets or revised estimations of asset life.