Walgreens Boots Alliance Inc. (NASDAQ:WBA)

Land and land improvements

The value showed a slight increasing trend from 2014 to 2016, rising from $3,418 million to $3,738 million, followed by a gradual decline through to 2019, ending at $3,507 million. This indicates modest investment in land assets in the earlier years, with some divestment or revaluation occurring in the latter years.

Buildings and building improvements

This category experienced overall growth, rising from $6,901 million in 2014 to $8,023 million in 2019. There was a noticeable increase in 2015, a slight dip in 2016 and 2017, and then renewed growth in 2018 and 2019. This pattern suggests ongoing capital expenditure with some fluctuations possibly due to project completions or asset disposals.

Fixtures and equipment

The figures increased significantly from $7,559 million in 2014 to $9,786 million in 2019. Most notably, the rise was steady over the entire period, reflecting continual investment in store fixtures and equipment, potentially driven by upgrades or expansion efforts.

Capitalized system development costs and software

This category showed the most pronounced growth, more than quadrupling from $688 million in 2014 to $2,770 million in 2019. This substantial increase indicates strong focus and investment in technology and software development over the period, highlighting a strategic shift towards digital and IT capabilities.

Capital lease properties

Values peaked in 2015 at $821 million from $530 million in 2014, followed by a steady decline to $703 million in 2019. The trend suggests initial leasing of properties with subsequent reductions, likely reflecting lease expirations or conversion of leases to owned assets.

Property, plant and equipment, at cost

Total cost rose from $19,096 million in 2014 to $24,789 million in 2019. The increase was gradual and consistent, reflecting accumulating investments across various asset categories despite some year-on-year fluctuations. This indicates a general expansion or maintenance/upgrading of the asset base.

Accumulated depreciation and amortization

Accumulated depreciation steadily increased in magnitude (more negative), from -$6,839 million in 2014 to -$11,311 million in 2019. This steady increase reflects ongoing asset usage and aging, consistent with the growth in asset cost, and signals that a significant portion of assets have been in service for extended periods.

Property, plant and equipment, net

The net book value of property, plant, and equipment showed an increase from $12,257 million in 2014 to a peak of $15,068 million in 2015, before declining steadily to $13,478 million in 2019. This downward trend after 2015 suggests that asset depreciation and disposals outpaced new capital expenditures in later years, potentially indicating a transition phase or asset base optimization.

Average Age Ratio

The average age ratio demonstrates a consistent increasing trend over the analyzed periods, rising from 43.62% in 2014 to 53.15% in 2019. This indicates that the property, plant, and equipment assets are aging, with a higher proportion of their useful lives consumed each year.

Estimated Total Useful Life

The estimated total useful life remained steady at 15 years from 2015 through 2018, with a slight decrease to 14 years recorded in 2019. The initial value in 2014 was higher at 17 years, suggesting a revision or updated assessment of asset longevity during the observed period.

Estimated Age, Time Elapsed Since Purchase

The estimated age of assets fluctuated marginally, starting at 7 years in 2014, dipping to 6 years in 2015, and returning to 7 years between 2016 and 2017. It then increased to 8 years for 2018 and 2019, indicating that assets are aging in line with or slightly faster than prior years, possibly reflecting a slower pace of new asset acquisitions or disposals.

Estimated Remaining Life

The estimated remaining life of assets shows a declining pattern, moving from 10 years in 2014 down to 7 years by 2018 and sustaining that level in 2019. This decline corresponds with the aging of the asset base and the slight reduction in estimated total useful life, indicating an accumulation of older assets nearing the end of their service periods.

Accumulated Depreciation and Amortization

The accumulated depreciation and amortization figures demonstrate a consistent upward trend from 2014 through 2019. Starting at $6,839 million in 2014, the value increases each year, reaching $11,311 million by the end of 2019. This steady rise indicates ongoing depreciation of assets, reflecting either investment in new property, plant, and equipment or the aging of existing assets.

Property, Plant and Equipment, at Cost

The cost of property, plant, and equipment shows growth over the six-year period, beginning at $19,096 million in 2014 and increasing to $24,789 million in 2019. This upward trend suggests capital expenditures or acquisitions leading to an increased asset base. Growth appears to moderate somewhat after 2015, with smaller incremental increases from 2016 to 2019.

Land and Land Improvements

Investment in land and land improvements remains relatively stable during the period, fluctuating slightly around an average of approximately $3,500 million. Notable is a minor decline from $3,738 million in 2016 to $3,507 million in 2019, indicating limited acquisition or enhancement activity in this category relative to other asset classes.

Average Age Ratio

The average age ratio, which measures the relative age of the asset base, shows a generally increasing trend from 43.62% in 2014 to 53.15% in 2019. This suggests the asset pool is aging over time without a proportionate influx of newer assets to lower the average age. The ratio increases gradually year over year, which may imply slower asset renewal or replacement strategies in recent years.

Overall Observations

The data reveals an expanding asset base in terms of cost, accompanied by steadily increasing accumulated depreciation, consistent with aging assets and ongoing depreciation charges. The relatively stable land values contrast with expanding overall asset investments, suggesting a focus on other asset categories within property, plant, and equipment. The rising average age ratio highlights a trend towards an aging asset base, potentially indicating a need for increased capital investment to refresh or modernize assets in the future.

The data regarding property, plant, and equipment over the periods from August 31, 2014, to August 31, 2019, displays several noteworthy trends and shifts in asset values and associated metrics.

Property, Plant and Equipment at Cost

The total cost of property, plant, and equipment exhibited a consistent upward trajectory across the six-year span. Beginning at approximately 19.1 billion US dollars in 2014, the figure climbed steadily each year, reaching about 24.8 billion US dollars by 2019. This represents an increase of nearly 30%, indicating ongoing investments or acquisitions in fixed assets.

Land and Land Improvements

The land and land improvements category showed more variation. Initially, from 2014 to 2016, there was a slight increase from 3.4 billion to nearly 3.7 billion US dollars. However, this was followed by a decline in 2017 to approximately 3.47 billion, a minor recovery in 2018 to around 3.59 billion, and a subsequent reduction again in 2019 to about 3.5 billion US dollars. This fluctuation suggests changes in land holdings, potential disposals, or revaluations during the period.

Depreciation and Amortization Expense for Property, Plant, and Equipment

The annual depreciation and amortization expense rose notably from 923 million US dollars in 2014 to 1.5 billion US dollars by 2019. After a significant jump between 2014 and 2015 (approximately 40%), the expense stabilized around 1.3 billion for three consecutive years before increasing again in 2018 and 2019. This pattern reflects either an expansion in capital assets subject to depreciation or potential changes in depreciation policies, possibly related to capitalized system development costs and software.

Estimated Total Useful Life

The estimated total useful life of the assets showed a declining trend. Initially at 17 years in 2014, it decreased to 15 years from 2015 through 2018, then dropped further to 14 years in 2019. The shortening of the useful life estimate may suggest reassessments of asset longevity, possibly influenced by accelerated technological changes or updates in asset utilization expectations.

Overall, the data reveals an expanding base of property, plant, and equipment investment, accompanied by increased depreciation expense and a shortening useful life estimate. Fluctuations in land and land improvements point to active management of real estate holdings. The increasing depreciation costs align with the rising asset base but also point to reduced asset lifespan, which may have implications for future capital expenditure and asset replacement strategies.

Accumulated Depreciation and Amortization

The accumulated depreciation and amortization amount shows a steady upward trend from $6,839 million in 2014 to $11,311 million in 2019. This indicates a continual increase in the total depreciation expensed over time, reflecting ongoing usage and aging of the property, plant, and equipment assets.

Depreciation and Amortization Expense

The depreciation and amortization expense for property, plant, and equipment, including capitalized system development costs and software, increased from $923 million in 2014 to $1,500 million in 2019. Notably, there was a significant rise from 2014 to 2015, after which the expense remained relatively flat at $1,300 million until 2017, followed by incremental increases in 2018 and 2019.

Time Elapsed Since Purchase

The average time elapsed since the purchase of assets fluctuated slightly but generally remained within the 6 to 8-year range. Starting at 7 years in 2014, it briefly decreased to 6 years in 2015, then returned to 7 years for the next two years, and finally increased to 8 years in both 2018 and 2019. This suggests a relatively stable asset holding period with a tendency toward aging assets in the latter years.

Overall Analysis

Overall, the data reflects a consistent increase in accumulated depreciation and amortization, indicative of asset aging and continued consumption. The depreciation expense experienced a pronounced rise early in the period, stabilizing for a few years before increasing again, which may point to adjustments in asset base or changes in depreciation policies. The stable to slightly increasing time since purchase suggests maintenance of an older asset base without significant recent additions to reduce average age. This combination of trends indicates a maturing portfolio of property, plant, and equipment assets with ongoing recognition of depreciation costs.

The data reveals several notable trends in the annual property, plant, and equipment (PP&E) figures over the six-year period ending August 31, 2019.

Net Property, Plant, and Equipment Value

There is an initial increase in net PP&E value, rising from 12,257 million US dollars in 2014 to a peak of 15,068 million US dollars in 2015. Subsequently, the net value declines steadily over the following years, reaching 13,478 million US dollars by 2019. This downward trend suggests that asset disposals, depreciation, or reduced capital expenditures may have outpaced acquisitions or improvements during this latter period.

Land and Land Improvements

The value of land and land improvements remains relatively stable throughout the period. Starting at 3,418 million US dollars in 2014, it shows a slight increase to 3,687 million US dollars in 2015 and peaks at 3,738 million US dollars in 2016, followed by modest decreases to 3,507 million US dollars by 2019. This stability indicates that land holdings did not undergo significant expansion or contraction, reflecting consistent investment or retention in this asset class.

Depreciation and Amortization Expense

Depreciation and amortization expense related to PP&E (including capitalized system development costs and software) increased substantially over the period. Beginning at 923 million US dollars in 2014, it rose sharply to 1,300 million US dollars by 2015 and remained steady through 2017. Thereafter, the expense increased further to 1,400 million in 2018 and 1,500 million in 2019. This upward trend reflects either accelerated depreciation policies, additional capital investments subject to amortization, or aging assets leading to increased expense recognition.

Estimated Remaining Life of Assets

The estimated remaining life of PP&E decreased from 10 years in 2014 to 7 years by 2019. This reduction in asset life indicates either aging of the asset base or possible changes in accounting estimates for asset longevity, which would also contribute to the observed increase in depreciation expense.

Overall, the data points to a maturing property, plant, and equipment portfolio, with declining net asset values after 2015, stable land asset levels, rising depreciation and amortization expenses, and shortening estimated remaining asset life. These factors combined suggest a period of reduced capital investment or asset disposals with increased recognition of depreciation, impacting the company's fixed asset base and related expenses.