Stock Analysis on Net
Stock Analysis on Net
Microsoft Excel LibreOffice Calc

PepsiCo Inc. (NASDAQ:PEP)

Analysis of Property, Plant and Equipment

Advanced level

Property, Plant and Equipment Disclosure

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

US$ in millions

Microsoft Excel LibreOffice Calc
Dec 28, 2019 Dec 29, 2018 Dec 30, 2017 Dec 31, 2016 Dec 26, 2015
Land 1,130  1,078  1,148  1,153  1,184 
Buildings and improvements 9,314  8,941  8,796  8,306  8,061 
Machinery and equipment, including fleet and software 29,390  27,715  27,018  25,277  24,764 
Construction in progress 3,169  2,430  2,144  2,082  1,738 
Property, plant and equipment, gross 43,003  40,164  39,106  36,818  35,747 
Accumulated depreciation (23,698) (22,575) (21,866) (20,227) (19,430)
Property, plant and equipment, net 19,305  17,589  17,240  16,591  16,317 

Based on: 10-K (filing date: 2020-02-13), 10-K (filing date: 2019-02-15), 10-K (filing date: 2018-02-13), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-11).

Item Description The company
Property, plant and equipment, gross 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. PepsiCo Inc.’s property, plant and equipment, gross increased from 2017 to 2018 and from 2018 to 2019.
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. PepsiCo Inc.’s property, plant and equipment, net increased from 2017 to 2018 and from 2018 to 2019.

Asset Age Ratios (Summary)

PepsiCo Inc., asset age ratios

Microsoft Excel LibreOffice Calc
Dec 28, 2019 Dec 29, 2018 Dec 30, 2017 Dec 31, 2016 Dec 26, 2015
Average age ratio 56.59% 57.76% 57.61% 56.71% 56.22%
Estimated total useful life (years) 19 17 17 16 15
Estimated age, time elapsed since purchase (years) 10 10 10 9 9
Estimated remaining life (years) 8 7 7 7 7

Based on: 10-K (filing date: 2020-02-13), 10-K (filing date: 2019-02-15), 10-K (filing date: 2018-02-13), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-11).

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’s fixed asset base is old or new. Newer assets are likely to be more efficient. PepsiCo Inc.’s average age ratio of depreciable property, plant and equipment deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 level.
Estimated total useful life Over longer time periods, this ratio is a useful measure of company’s depreciation policy and can be used for comparisons with competitors. PepsiCo Inc.’s estimated total useful life of depreciable property, plant and equipment increased from 2017 to 2018 and from 2018 to 2019.
Estimated time elapsed since purchase The approximate age in years of a company’s fixed assets. Useful for comparison purposes. PepsiCo Inc.’s estimated time elapsed since purchase of depreciable property, plant and equipment deteriorated from 2017 to 2018 and from 2018 to 2019.
Estimated remaining life PepsiCo Inc.’s estimated remaining life of depreciable property, plant and equipment increased from 2017 to 2018 and from 2018 to 2019.

Average Age

Microsoft Excel LibreOffice Calc
Dec 28, 2019 Dec 29, 2018 Dec 30, 2017 Dec 31, 2016 Dec 26, 2015
Selected Financial Data (US$ in millions)
Accumulated depreciation 23,698  22,575  21,866  20,227  19,430 
Property, plant and equipment, gross 43,003  40,164  39,106  36,818  35,747 
Land 1,130  1,078  1,148  1,153  1,184 
Asset Age Ratio
Average age1 56.59% 57.76% 57.61% 56.71% 56.22%

Based on: 10-K (filing date: 2020-02-13), 10-K (filing date: 2019-02-15), 10-K (filing date: 2018-02-13), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-11).

2019 Calculations

1 Average age = 100 × Accumulated depreciation ÷ (Property, plant and equipment, gross – Land)
= 100 × 23,698 ÷ (43,003 – 1,130) = 56.59%

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’s fixed asset base is old or new. Newer assets are likely to be more efficient. PepsiCo Inc.’s average age ratio of depreciable property, plant and equipment deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 level.

Estimated Total Useful Life

Microsoft Excel LibreOffice Calc
Dec 28, 2019 Dec 29, 2018 Dec 30, 2017 Dec 31, 2016 Dec 26, 2015
Selected Financial Data (US$ in millions)
Property, plant and equipment, gross 43,003  40,164  39,106  36,818  35,747 
Land 1,130  1,078  1,148  1,153  1,184 
Depreciation expense 2,257  2,241  2,227  2,217  2,248 
Asset Age Ratio (Years)
Estimated total useful life1 19 17 17 16 15

Based on: 10-K (filing date: 2020-02-13), 10-K (filing date: 2019-02-15), 10-K (filing date: 2018-02-13), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-11).

2019 Calculations

1 Estimated total useful life = (Property, plant and equipment, gross – Land) ÷ Depreciation expense
= (43,003 – 1,130) ÷ 2,257 = 19

Asset age ratio Description The company
Estimated total useful life Over longer time periods, this ratio is a useful measure of company’s depreciation policy and can be used for comparisons with competitors. PepsiCo Inc.’s estimated total useful life of depreciable property, plant and equipment increased from 2017 to 2018 and from 2018 to 2019.

Estimated Age, Time Elapsed since Purchase

Microsoft Excel LibreOffice Calc
Dec 28, 2019 Dec 29, 2018 Dec 30, 2017 Dec 31, 2016 Dec 26, 2015
Selected Financial Data (US$ in millions)
Accumulated depreciation 23,698  22,575  21,866  20,227  19,430 
Depreciation expense 2,257  2,241  2,227  2,217  2,248 
Asset Age Ratio (Years)
Time elapsed since purchase1 10 10 10 9 9

Based on: 10-K (filing date: 2020-02-13), 10-K (filing date: 2019-02-15), 10-K (filing date: 2018-02-13), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-11).

2019 Calculations

1 Time elapsed since purchase = Accumulated depreciation ÷ Depreciation expense
= 23,698 ÷ 2,257 = 10

Asset age ratio Description The company
Estimated time elapsed since purchase The approximate age in years of a company’s fixed assets. Useful for comparison purposes. PepsiCo Inc.’s estimated time elapsed since purchase of depreciable property, plant and equipment deteriorated from 2017 to 2018 and from 2018 to 2019.

Estimated Remaining Life

Microsoft Excel LibreOffice Calc
Dec 28, 2019 Dec 29, 2018 Dec 30, 2017 Dec 31, 2016 Dec 26, 2015
Selected Financial Data (US$ in millions)
Property, plant and equipment, net 19,305  17,589  17,240  16,591  16,317 
Land 1,130  1,078  1,148  1,153  1,184 
Depreciation expense 2,257  2,241  2,227  2,217  2,248 
Asset Age Ratio (Years)
Estimated remaining life1 8 7 7 7 7

Based on: 10-K (filing date: 2020-02-13), 10-K (filing date: 2019-02-15), 10-K (filing date: 2018-02-13), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-11).

2019 Calculations

1 Estimated remaining life = (Property, plant and equipment, net – Land) ÷ Depreciation expense
= (19,305 – 1,130) ÷ 2,257 = 8

Asset age ratio Description The company
Estimated remaining life PepsiCo Inc.’s estimated remaining life of depreciable property, plant and equipment increased from 2017 to 2018 and from 2018 to 2019.