Bristol-Myers Squibb Co. (NYSE:BMY)

The analysis of annual property, plant, and equipment data reveals several notable trends in asset composition and valuation over the five-year period.

Land

Land value exhibits a gradual decline, decreasing from $189 million in 2020 to $161 million in 2024, indicating possible disposals or revaluations of land assets during this period.

Buildings

Building assets show consistent growth, rising steadily from $5,732 million in 2020 to $6,581 million in 2024. The most significant increase appears between 2022 and 2023, reflecting potential new construction or acquisitions.

Machinery, Equipment, and Fixtures

This category steadily increased from $3,063 million in 2020 to $3,818 million in 2024. The growth is relatively consistent year-over-year, suggesting ongoing investments in operational assets.

Construction in Progress

The value for construction in progress shows substantial increases, nearly tripling from $487 million in 2020 to $1,525 million in 2024. This trend highlights significant ongoing capital projects that have yet to be capitalized as completed assets.

Gross Property, Plant, and Equipment

The total gross property, plant, and equipment increased from $9,471 million to $12,085 million over the period, reflecting the cumulative effect of additions across categories, especially buildings and construction in progress.

Accumulated Depreciation

Accumulated depreciation consistently grew in absolute value, moving from -$3,585 million in 2020 to -$4,949 million in 2024. The increasing accumulated depreciation aligns with the asset base expansion and age of existing assets.

Net Property, Plant, and Equipment

Net property, plant, and equipment showed a steady upward trend, growing from $5,886 million to $7,136 million, demonstrating asset base growth net of depreciation. This increase highlights sustained investment offset by regular depreciation charges.

Overall, the data indicates a strategic expansion and modernization of the property, plant, and equipment portfolio, supported by ongoing capital projects. Despite slight declines in land value, substantial increases in buildings, machinery, and construction in progress underscore a focus on enhancing productive capacity. The rising accumulated depreciation reflects the aging asset base and consistent utilization.

Average Age Ratio

The average age ratio exhibited a general upward trend from 38.62% in 2020 to a peak of 42.55% in 2023, indicating that the property, plant, and equipment (PP&E) portfolio has been aging over this period. However, there is a slight decline to 41.5% in 2024, suggesting a marginal reduction in the relative age of assets compared to their useful lives.

Estimated Total Useful Life

The estimated total useful life of the assets increased from 16 years in 2020 to 18 years in 2021, maintaining a range between 17 and 18 years through 2024. This points to a reassessment of asset longevity, potentially reflecting changes in maintenance practices, asset quality, or technological updates.

Estimated Age, Time Elapsed Since Purchase

The estimated age, representing the time elapsed since purchase, consistently increased from 6 years in 2020 to 8 years by 2023, and remained stable at 8 years in 2024. This steady rise corresponds with the natural aging process of the asset base without significant early disposals or asset replacement accelerating turnover.

Estimated Remaining Life

The estimated remaining life demonstrated slight fluctuations, moving from 10 years in 2020 to 11 years in 2021, then down to 10 years in 2022, and back to 11 years from 2023 onwards. The stability in remaining life towards the later years suggests consistent expectations regarding the duration that assets will continue to be productive.

Gross Property, Plant and Equipment (PPE)

The gross value of property, plant, and equipment showed a consistent upward trend from 2020 to 2024. Starting at US$9,471 million in 2020, it increased steadily each year, reaching US$12,085 million by 2024. This represents an approximate 27.6% growth over the five-year period, indicating ongoing investments in long-term assets.

Accumulated Depreciation

The accumulated depreciation also increased year over year, moving from US$3,585 million in 2020 to US$4,949 million in 2024. The growth in accumulated depreciation generally aligns with the rise in gross PPE, reflecting the systematic expensing of these assets over their useful lives. The increase suggests an aging asset base and continued utilization of fixed assets.

Land

The value attributed to land remained relatively stable but showed a slight declining trend, decreasing from US$189 million in 2020 to US$161 million in 2024. Since land is a non-depreciable asset, this subtle decrease could reflect disposals or revaluations rather than wear and tear.

Average Age Ratio

The average age ratio, which indicates the proportion of the asset base that is depreciated, fluctuated slightly during the period. It started at 38.62% in 2020, increased to 42.55% by 2023, and slightly declined to 41.5% in 2024. This pattern suggests that on average, the asset base is aging, but with some renewal or additions of newer assets in the later period that slightly mitigated the increase in average age.

Overall Insights

The data depict a scenario of steady capital expenditure growth supporting the company’s operations. The increasing gross PPE suggests ongoing investment and asset expansion. Concurrently, increasing accumulated depreciation signals the aging and usage of these assets. The slight decrease in the average age ratio in the last year implies at least some portion of the asset base was refreshed or replaced, which may have implications for future depreciation charges and operational capacity.

Gross Property, Plant, and Equipment

The gross property, plant, and equipment value showed a consistent upward trend over the observed period. Starting at US$9,471 million in 2020, it increased to US$12,085 million by 2024, reflecting a steady annual growth. This pattern suggests ongoing investment in capital assets, which may indicate expansion or modernization efforts.

Land

The value of land exhibited a slight decreasing trend. It declined from US$189 million in 2020 to US$161 million in 2024. This marginal reduction could be attributed to revaluation adjustments or potential disposals of land assets.

Depreciation Expense

Depreciation expense fluctuated during the period but demonstrated an overall upward movement. Starting at US$586 million in 2020, it decreased slightly in 2021 to US$559 million, then increased each subsequent year, reaching US$651 million in 2024. The rising depreciation expense aligns with the increasing asset base and may reflect aging or acquisition of depreciable assets.

Estimated Total Useful Life

The estimated total useful life of property, plant, and equipment remained relatively stable, fluctuating between 16 and 18 years. It increased from 16 years in 2020 to 18 years in 2021, briefly decreased to 17 years in 2022, then stabilized at 18 years for 2023 and 2024. This consistency suggests no significant changes in asset longevity assumptions.

The financial data relating to property, plant, and equipment exhibits several noteworthy trends over the five-year period ending in 2024.

Accumulated Depreciation

Accumulated depreciation values show a consistent upward trend from 3,585 million USD in 2020 to 4,949 million USD in 2024. This steady increase indicates ongoing depreciation charges consistent with asset aging and usage, reflecting the systematic allocation of the cost of the company’s property, plant, and equipment over their useful lives.

Depreciation Expense

Depreciation expense presents a relatively stable but slightly rising pattern, fluctuating between 559 million USD and 651 million USD over the period. After a minor dip in 2021, the expense has generally increased each subsequent year, reaching its highest point in 2024. This trend suggests either incremental additions to depreciable assets or changes in asset composition that result in higher annual depreciation charges.

Time Elapsed Since Purchase

The average age of the assets, measured as the time elapsed since purchase, increases gradually from 6 years in 2020 to 8 years by 2023, remaining constant in 2024. This steady aging correlates with the rise in accumulated depreciation and indicates that the asset base is maturing over time.

In summary, the data reveals a consistent pattern of asset aging and depreciation. Accumulated depreciation is rising steadily, corroborated by a generally increasing depreciation expense. The average age of assets advancing over time supports these observations, pointing to a relatively stable portfolio without significant asset turnover or early retirements affecting depreciation trends during this period.

The analysis of the property, plant, and equipment data reveals several important trends across the five-year period under review.

Property, plant, and equipment, net

The net value of property, plant, and equipment consistently increased each year from 2020 to 2024. Starting at $5,886 million in 2020, the value rose steadily to reach $7,136 million by 2024. This represents an overall growth of approximately 21.3% over the five years, indicating ongoing investments or capital improvements that have outweighed the impact of depreciation.

Land

The value of land showed a slight declining trend over the same period. Beginning at $189 million in 2020, the value decreased gradually to $161 million by 2024. This decline may be attributed to disposals or revaluations, although the changes are relatively minor compared to other asset components.

Depreciation expense

The depreciation expense exhibited some fluctuations but overall trended upwards. It decreased from $586 million in 2020 to $559 million in 2021, then increased again each subsequent year to reach $651 million in 2024. This growth in depreciation expense correlates with the increase in net property, plant, and equipment, reflecting higher asset bases subject to depreciation.

Estimated remaining life

The estimated remaining life of the assets remained relatively stable, ranging from 10 to 11 years throughout the evaluation period. This stability suggests consistent asset replacement and maintenance cycles, with no significant changes to asset aging or lifespan expectations.

In summary, the data reflects steady capital growth in property, plant, and equipment, balanced by increasing depreciation costs and a slight decrease in land holdings. The estimated remaining life of assets remains stable, supporting a consistent asset management strategy over time.