Analysis of Operating Leases
An operating lease is treated like a rental contract. Neither the leased asset nor the associated liability is reported on the lessee balance sheet, but the rights may be very similar to the rights of an owner. The lessee only records the lease payments as a rental expense in income statement.
Present Value of Future Operating Lease Payments (before Adoption of FASB Topic 842)
Chevron Corp., future operating lease payments (before adoption of FASB Topic 842)
US$ in millions
Based on: 10-K (filing date: 2020-02-21), 10-K (filing date: 2019-02-22), 10-K (filing date: 2018-02-22), 10-K (filing date: 2017-02-23), 10-K (filing date: 2016-02-25).
1 Weighted-average discount rate for finance leases
Year | Future operating lease payments (as reported) | Year | Future operating lease payments (estimated) | Present value at 8.24% |
---|---|---|---|---|
2019 | 540 | 2019 | 540 | 499 |
2020 | 492 | 2020 | 492 | 420 |
2021 | 378 | 2021 | 378 | 298 |
2022 | 242 | 2022 | 242 | 176 |
2023 | 166 | 2023 | 166 | 112 |
2024 and thereafter | 341 | 2024 | 166 | 103 |
2025 | 166 | 95 | ||
2026 | 9 | 5 | ||
Total: | 2,159 | 2,159 | 1,708 |
Based on: 10-K (filing date: 2019-02-22).
Year | Future operating lease payments (as reported) | Year | Future operating lease payments (estimated) | Present value at 11.02% |
---|---|---|---|---|
2018 | 693 | 2018 | 693 | 624 |
2019 | 628 | 2019 | 628 | 510 |
2020 | 474 | 2020 | 474 | 346 |
2021 | 339 | 2021 | 339 | 223 |
2022 | 223 | 2022 | 223 | 132 |
2023 and thereafter | 538 | 2023 | 223 | 119 |
2024 | 223 | 107 | ||
2025 | 92 | 40 | ||
Total: | 2,895 | 2,895 | 2,102 |
Based on: 10-K (filing date: 2018-02-22).
Year | Future operating lease payments (as reported) | Year | Future operating lease payments (estimated) | Present value at 12.05% |
---|---|---|---|---|
2017 | 615 | 2017 | 615 | 549 |
2018 | 554 | 2018 | 554 | 441 |
2019 | 387 | 2019 | 387 | 275 |
2020 | 298 | 2020 | 298 | 189 |
2021 | 235 | 2021 | 235 | 133 |
2022 and thereafter | 392 | 2022 | 235 | 119 |
2023 | 157 | 71 | ||
Total: | 2,481 | 2,481 | 1,777 |
Based on: 10-K (filing date: 2017-02-23).
Year | Future operating lease payments (as reported) | Year | Future operating lease payments (estimated) | Present value at 8.83% |
---|---|---|---|---|
2016 | 846 | 2016 | 846 | 777 |
2017 | 689 | 2017 | 689 | 582 |
2018 | 554 | 2018 | 554 | 430 |
2019 | 420 | 2019 | 420 | 299 |
2020 | 311 | 2020 | 311 | 204 |
2021 and thereafter | 528 | 2021 | 311 | 187 |
2022 | 217 | 120 | ||
Total: | 3,348 | 3,348 | 2,599 |
Based on: 10-K (filing date: 2016-02-25).
Adjustments to Financial Statements for Operating Leases
Chevron Corp., adjustments to financial statements
US$ in millions
Based on: 10-K (filing date: 2020-02-21), 10-K (filing date: 2019-02-22), 10-K (filing date: 2018-02-22), 10-K (filing date: 2017-02-23), 10-K (filing date: 2016-02-25).
1, 2 Equal to total present value of future operating lease payments.
Chevron Corp., Financial Data: Reported vs. Adjusted
Adjusted Financial Ratios for Operating Leases (Summary)
Chevron Corp., adjusted financial ratios
Based on: 10-K (filing date: 2020-02-21), 10-K (filing date: 2019-02-22), 10-K (filing date: 2018-02-22), 10-K (filing date: 2017-02-23), 10-K (filing date: 2016-02-25).
Financial ratio | Description | The company |
---|---|---|
Adjusted total asset turnover | An activity ratio calculated as total revenue divided by adjusted total assets. | Chevron Corp.’s adjusted total asset turnover ratio improved from 2017 to 2018 but then slightly deteriorated from 2018 to 2019. |
Adjusted debt to equity | A solvency ratio calculated as adjusted total debt divided by total shareholders’ equity. | Chevron Corp.’s adjusted debt to equity ratio improved from 2017 to 2018 and from 2018 to 2019. |
Adjusted ROA | A profitability ratio calculated as net income divided by adjusted total assets. | Chevron Corp.’s adjusted ROA improved from 2017 to 2018 but then deteriorated significantly from 2018 to 2019. |
Chevron Corp., Financial Ratios: Reported vs. Adjusted
Adjusted Total Asset Turnover
Based on: 10-K (filing date: 2020-02-21), 10-K (filing date: 2019-02-22), 10-K (filing date: 2018-02-22), 10-K (filing date: 2017-02-23), 10-K (filing date: 2016-02-25).
2019 Calculations
1 Total asset turnover = Sales and other operating revenues ÷ Total assets
= 139,865 ÷ 237,428 = 0.59
2 Adjusted total asset turnover = Sales and other operating revenues ÷ Adjusted total assets
= 139,865 ÷ 237,428 = 0.59
Activity ratio | Description | The company |
---|---|---|
Adjusted total asset turnover | An activity ratio calculated as total revenue divided by adjusted total assets. | Chevron Corp.’s adjusted total asset turnover ratio improved from 2017 to 2018 but then slightly deteriorated from 2018 to 2019. |
Adjusted Debt to Equity
Based on: 10-K (filing date: 2020-02-21), 10-K (filing date: 2019-02-22), 10-K (filing date: 2018-02-22), 10-K (filing date: 2017-02-23), 10-K (filing date: 2016-02-25).
2019 Calculations
1 Debt to equity = Total debt ÷ Total Chevron Corporation stockholders’ equity
= 26,973 ÷ 144,213 = 0.19
2 Adjusted debt to equity = Adjusted total debt ÷ Total Chevron Corporation stockholders’ equity
= 30,858 ÷ 144,213 = 0.21
Solvency ratio | Description | The company |
---|---|---|
Adjusted debt-to-equity | A solvency ratio calculated as adjusted total debt divided by total shareholders’ equity. | Chevron Corp.’s adjusted debt-to-equity ratio improved from 2017 to 2018 and from 2018 to 2019. |
Adjusted Return on Assets (ROA)
Based on: 10-K (filing date: 2020-02-21), 10-K (filing date: 2019-02-22), 10-K (filing date: 2018-02-22), 10-K (filing date: 2017-02-23), 10-K (filing date: 2016-02-25).
2019 Calculations
1 ROA = 100 × Net income (loss) attributable to Chevron Corporation ÷ Total assets
= 100 × 2,924 ÷ 237,428 = 1.23%
2 Adjusted ROA = 100 × Net income (loss) attributable to Chevron Corporation ÷ Adjusted total assets
= 100 × 2,924 ÷ 237,428 = 1.23%
Profitability ratio | Description | The company |
---|---|---|
Adjusted ROA | A profitability ratio calculated as net income divided by adjusted total assets. | Chevron Corp.’s adjusted ROA improved from 2017 to 2018 but then deteriorated significantly from 2018 to 2019. |