PepsiCo Inc. (NASDAQ:PEP)

Land

The value of land shows minor fluctuations over the five-year period. Beginning at $1,171 million in 2020, it decreased slightly to $1,123 million in 2021, followed by moderate increases to reach $1,159 million in 2023 before a slight decline to $1,136 million in 2024. Overall, land values remained relatively stable.

Buildings and improvements

This category exhibited consistent growth throughout the period. Starting at $10,214 million in 2020, the value increased steadily each year, reaching $11,938 million in 2024. The growth appears steady without significant volatility, indicating ongoing investments or upgrades in facilities.

Machinery and equipment, including fleet and software

There was a clear upward trend in this category. The value rose from $31,276 million in 2020 to $36,990 million in 2024. The increases were gradual but consistent, with a slightly larger increment observed around 2023, reflecting potential capital expenditures in machinery, equipment, and technology assets.

Construction in progress

This item showed substantial growth over the period under review. Beginning at $3,679 million in 2020, it increased annually to $5,941 million by 2024. This significant rise suggests ongoing major projects or expansions not yet capitalized as finished assets.

Property, plant and equipment, gross

The gross value of property, plant, and equipment increased steadily from $46,340 million in 2020 to $56,005 million in 2024. This growth is consistent with the individual increases in buildings, machinery, and construction in progress, indicating an expanding asset base at gross value.

Accumulated depreciation

Accumulated depreciation grew in magnitude negatively from -$24,971 million in 2020 to -$27,997 million in 2024. The increase in accumulated depreciation corresponds to the aging of assets and ongoing depreciation expenses, though the growth rate appears moderate and consistent with asset increases.

Property, plant and equipment, net

Net property, plant, and equipment showed a positive upward trend, increasing from $21,369 million in 2020 to $28,008 million in 2024. This reflects the combined effect of asset additions outpacing depreciation, signaling ongoing investments and asset base growth in net terms.

Average Age Ratio

The average age ratio shows a consistent decreasing trend over the five-year period. Starting at 55.28% in 2020, it declines each year, reaching 51.03% in 2024. This indicates a gradual reduction in the proportion of asset life that has been used, suggesting a relatively younger property, plant, and equipment base over time.

Estimated Total Useful Life

The estimated total useful life of the assets fluctuates moderately during the period reviewed. It decreases from 19 years in 2020 to 18 years in 2021, then increases back to 19 years in 2022, peaks at 20 years in 2023, and returns to 19 years in 2024. This variability might reflect changes in asset composition or revisions in useful life estimates based on asset condition or usage patterns.

Estimated Age (Time Elapsed Since Purchase)

The estimated age of assets remains relatively stable, hovering around 10 to 11 years. Starting at 11 years in 2020, it declines to 10 years from 2021 to 2024. This stability implies a consistent replacement or acquisition cycle, maintaining a marginally younger asset base through the later years.

Estimated Remaining Life

The estimated remaining life of the assets mostly remains constant at 9 years, with a slight increase to 10 years in 2023 before returning to 9 years in 2024. This suggests that despite fluctuations in total useful life, the company expects assets to retain a similar remaining lifespan throughout the period, potentially due to maintenance or refurbishment practices extending asset longevity.

The analysis of the annual financial data for property, plant, and equipment reveals several notable trends and insights.

Property, Plant, and Equipment, Gross

The gross value of property, plant, and equipment shows a consistent upward trend over the five-year period, increasing from US$46,340 million in 2020 to US$56,005 million in 2024. This growth suggests ongoing investments in fixed assets, reflecting expansion or significant asset upgrades.

Accumulated Depreciation

Accumulated depreciation exhibits a generally increasing trend from US$24,971 million in 2020 to US$27,997 million in 2024, with a slight dip observed in 2021 where it decreased to US$24,421 million. The overall increase in accumulated depreciation aligns with the increased gross asset base, indicating steady asset aging and usage over time.

Land

The recorded value for land remains relatively stable throughout the period, with minor fluctuations ranging between US$1,123 million and US$1,171 million. This stability is expected as land is not depreciated and usually does not change significantly unless there are acquisitions or disposals.

Average Age Ratio

The average age ratio shows a gradual decrease from 55.28% in 2020 to 51.03% in 2024. A declining average age ratio suggests that the asset base is becoming relatively younger, possibly due to recent acquisitions or asset replacements outpacing the retirement or depreciation of older assets.

In summary, the company demonstrates a pattern of steady growth in its property, plant, and equipment holdings, accompanied by corresponding increases in accumulated depreciation. The stable land valuation confirms a consistent non-depreciable asset base. Additionally, the reduction in the average age ratio indicates asset renewal efforts which may enhance operational efficiency and future productive capacity.

Property, plant and equipment, gross

The gross value of property, plant, and equipment showed a consistent upward trend across the five-year period. Starting at 46,340 million US dollars in 2020, it increased steadily each year, reaching 56,005 million US dollars by 2024. This represents a cumulative growth of approximately 20.8%, indicating ongoing investment and expansion in these asset categories.

Land

The recorded value of land remained relatively stable over the years, with minor fluctuations. It started at 1,171 million US dollars in 2020, decreased slightly to 1,123 million in 2021, and then experienced marginal increases and decreases, ultimately recording 1,136 million US dollars in 2024. The minimal change in land value suggests limited acquisition or disposal activity in this category during the period.

Depreciation expense

Depreciation expense demonstrated a clear upward trajectory from 2,335 million US dollars in 2020 to 2,945 million in 2024. The consistent increase reflects increased asset base and aging of existing assets, resulting in higher systematic allocation of cost to expense over time. The nearly 26.1% increase over five years aligns with the rise in gross property, plant, and equipment values.

Estimated total useful life

The estimated total useful life of property, plant, and equipment fluctuated slightly but remained around an average of 19 years throughout the period. This consistency suggests stability in asset longevity assumptions used for depreciation calculations, with values ranging between 18 and 20 years.

Accumulated Depreciation

The accumulated depreciation shows an overall increasing trend from 24,421 million US dollars in 2021 to 27,997 million US dollars in 2024, despite a slight dip from 24,971 million in 2020 to 24,421 million in 2021. This suggests a consistent buildup of depreciation over the years, reflecting ongoing wear and usage of property, plant, and equipment assets.

Depreciation Expense

The depreciation expense has steadily increased over the analyzed period, rising from 2,335 million US dollars in 2020 to 2,945 million US dollars in 2024. This upward trend indicates an intensification in the annual cost allocated for asset depreciation, which could be attributed to either higher asset values or changes in depreciation policies.

Time Elapsed Since Purchase

The average time elapsed since purchase remained relatively stable, fluctuating around 10-11 years throughout the period. This stability implies that asset turnover or replacement cycles have not significantly changed during the analyzed years.

Property, Plant, and Equipment, Net

The net value of property, plant, and equipment exhibits a consistent upward trend over the five-year period. Starting from $21,369 million in 2020, it increased to $28,008 million by 2024. This steady growth indicates ongoing investments or acquisitions in fixed assets, with a notable acceleration in the latter years, particularly between 2022 and 2023.

Land

The value of land assets remains relatively stable, fluctuating around the $1,100 million mark throughout the period. The figures show a slight decline from $1,171 million in 2020 to $1,136 million in 2024, suggesting minor disposals or revaluation but overall little change in the land holdings.

Depreciation Expense

Depreciation expense demonstrates a steady increase from $2,335 million in 2020 to $2,945 million in 2024. The escalation aligns with the growth in net property, plant, and equipment, reflecting higher depreciation charges as more assets are in use or as existing assets age. The consistent upward trend also suggests a stable depreciation policy without significant changes in useful life assumptions.

Estimated Remaining Life

The estimated remaining life of the property, plant, and equipment remains constant at 9 years for most years, except for a slight increase to 10 years in 2023 before reverting to 9 years in 2024. This minor fluctuation indicates overall stability in asset longevity assessments over the period.