Stock Analysis on Net

Vertex Pharmaceuticals Inc. (NASDAQ:VRTX)

Analysis of Property, Plant and Equipment

Microsoft Excel

Property, Plant and Equipment Disclosure

Vertex Pharmaceuticals Inc., balance sheet: property, plant and equipment

US$ in thousands

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Buildings and improvements 928,600 903,100 892,500 876,091 713,412
Laboratory equipment, other equipment and furniture 579,100 476,500 407,300 346,698 317,567
Leasehold improvements 474,600 410,900 363,500 234,585 175,769
Computers and software 332,800 312,100 293,700 258,612 230,872
Land 33,100 33,100 33,100 33,128
Property and equipment, gross 2,348,200 2,135,700 1,990,100 1,749,114 1,437,620
Accumulated depreciation (1,188,900) (1,027,300) (896,000) (790,580) (692,540)
Property and equipment, net 1,159,300 1,108,400 1,094,100 958,534 745,080

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 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. Vertex Pharmaceuticals Inc. property and equipment, gross increased from 2021 to 2022 and from 2022 to 2023.
Property 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. Vertex Pharmaceuticals Inc. property and equipment, net increased from 2021 to 2022 and from 2022 to 2023.

Asset Age Ratios (Summary)

Vertex Pharmaceuticals Inc., asset age ratios

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Average age ratio 51.35% 48.86% 45.78% 46.07% 48.17%
Estimated total useful life (years) 14 14 16 16 13
Estimated age, time elapsed since purchase (years) 7 7 7 7 6
Estimated remaining life (years) 7 7 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).

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. Vertex Pharmaceuticals Inc. average age ratio of depreciable property, plant and equipment deteriorated 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. Vertex Pharmaceuticals Inc. estimated total useful life of depreciable property, plant and equipment decreased 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. Vertex Pharmaceuticals Inc. estimated time elapsed since purchase of depreciable property, plant and equipment improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023 not reaching 2021 level.
Estimated remaining life Vertex Pharmaceuticals Inc. estimated remaining life of depreciable property, plant and equipment decreased 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 thousands)
Accumulated depreciation 1,188,900 1,027,300 896,000 790,580 692,540
Property and equipment, gross 2,348,200 2,135,700 1,990,100 1,749,114 1,437,620
Land 33,100 33,100 33,100 33,128
Asset Age Ratio
Average age1 51.35% 48.86% 45.78% 46.07% 48.17%

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 and equipment, gross – Land)
= 100 × 1,188,900 ÷ (2,348,20033,100) = 51.35%

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. Vertex Pharmaceuticals Inc. average age ratio of depreciable property, plant and equipment deteriorated 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 thousands)
Property and equipment, gross 2,348,200 2,135,700 1,990,100 1,749,114 1,437,620
Land 33,100 33,100 33,100 33,128
Depreciation expense 167,800 148,300 125,600 109,500 106,900
Asset Age Ratio (Years)
Estimated total useful life1 14 14 16 16 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 and equipment, gross – Land) ÷ Depreciation expense
= (2,348,20033,100) ÷ 167,800 = 14

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. Vertex Pharmaceuticals Inc. estimated total useful life of depreciable property, plant and equipment decreased 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 thousands)
Accumulated depreciation 1,188,900 1,027,300 896,000 790,580 692,540
Depreciation expense 167,800 148,300 125,600 109,500 106,900
Asset Age Ratio (Years)
Time elapsed since purchase1 7 7 7 7 6

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 ÷ Depreciation expense
= 1,188,900 ÷ 167,800 = 7

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. Vertex Pharmaceuticals Inc. estimated time elapsed since purchase of depreciable property, plant and equipment improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023 not reaching 2021 level.

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 thousands)
Property and equipment, net 1,159,300 1,108,400 1,094,100 958,534 745,080
Land 33,100 33,100 33,100 33,128
Depreciation expense 167,800 148,300 125,600 109,500 106,900
Asset Age Ratio (Years)
Estimated remaining life1 7 7 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 Estimated remaining life = (Property and equipment, net – Land) ÷ Depreciation expense
= (1,159,30033,100) ÷ 167,800 = 7

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