Analysis of Property, Plant and Equipment
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- Balance Sheet: Assets
- Balance Sheet: Liabilities and Stockholders’ Equity
- Common-Size Income Statement
- Analysis of Liquidity Ratios
- Analysis of Reportable Segments
- Present Value of Free Cash Flow to Equity (FCFE)
- Operating Profit Margin since 2005
- Return on Equity (ROE) since 2005
- Return on Assets (ROA) since 2005
- Total Asset Turnover since 2005
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Property, Plant and Equipment Disclosure
Cigna Group, balance sheet: property, plant and equipment
US$ in millions
Based on: 10-K (reporting date: 2024-12-31), 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).
- Internal-use software
- The value of internal-use software shows a consistent upward trend over the five-year period. It increased steadily each year from US$7,061 million in 2020 to US$11,295 million in 2024, reflecting ongoing investment and development in software assets.
- Other property and equipment
- This category exhibits some volatility with a slight increase from US$2,719 million in 2020 to US$2,839 million in 2021, followed by a notable decline to US$2,256 million in 2022. It remained relatively stable thereafter but showed a minor decrease by 2024 to US$2,115 million, indicating possible asset disposals or reduced acquisitions in this segment.
- Property and equipment, cost
- The total cost of property and equipment rose progressively from US$9,780 million in 2020 to US$13,410 million in 2024. This steady increase suggests continual capital expenditures, primarily driven by investments in internal-use software and other assets.
- Accumulated depreciation and amortization
- Accumulated depreciation and amortization increased in absolute terms each year, moving from -US$5,575 million in 2020 to -US$9,454 million in 2024. The growing negative value reflects the systematic allocation of the cost of assets over their useful lives and supports the expansion of the asset base during the period.
- Property and equipment, net carrying value
- The net carrying value of property and equipment declined initially from US$4,205 million in 2020 to US$3,774 million in 2022, before stabilizing and slightly increasing to US$3,956 million in 2024. This pattern suggests that depreciation expense and asset disposals outpaced new acquisitions in the early years, but investment in new assets began to offset the decline later in the period.
Asset Age Ratios (Summary)
Cigna Group, asset age ratios
Based on: 10-K (reporting date: 2024-12-31), 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).
- Average Age Ratio
- The average age ratio has shown a consistent upward trend over the five-year period, increasing from 57% in 2020 to 70.5% in 2024. This indicates that the property, plant, and equipment assets are aging, with a growing proportion of their useful life already elapsed.
- Estimated Total Useful Life
- The estimated total useful life remained stable at 8 years from 2020 through 2023, after which it increased to 11 years in 2024. This adjustment suggests a reassessment or extension of the expected service life of the assets in the final year reported.
- Estimated Age, Time Elapsed Since Purchase
- The estimated age of assets has steadily increased each year, from 4 years in 2020 to 7 years in 2024, matching expectations as assets age over time without significant additions or retirements significantly altering the average.
- Estimated Remaining Life
- The estimated remaining life remained constant at 3 years throughout the period from 2020 to 2024, despite the increase in total useful life in 2024. This suggests that the assets currently held are consistently projected to have a remaining service duration of 3 years.
Average Age
Based on: 10-K (reporting date: 2024-12-31), 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).
2024 Calculations
1 Average age = 100 × Accumulated depreciation and amortization ÷ Property and equipment, cost
= 100 × ÷ =
- Accumulated depreciation and amortization
- The accumulated depreciation and amortization shows a consistent upward trend from 5,575 million US dollars in 2020 to 9,454 million US dollars in 2024. This represents a total increase of approximately 69.6% over the five-year period, indicating continuous allocation of cost recovery over the asset's useful life.
- Property and equipment, cost
- The property and equipment cost also exhibits a steady increase from 9,780 million US dollars in 2020 to 13,410 million US dollars in 2024. This increase of about 37.1% suggests ongoing capital expenditures or acquisitions of property and equipment assets during the period under consideration.
- Average age ratio
- The average age ratio, which reflects the relative age of the property and equipment assets, increased from 57% in 2020 to 70.5% in 2024. This rising trend indicates that the asset base is getting older on average, potentially reflecting slower asset replacement or longer usage of existing assets.
- Overall analysis
- Over the examined period, both the accumulated depreciation and the cost of property and equipment increased, with depreciation growing at a relatively faster rate compared to cost. This is consistent with the rising average age ratio, signifying an aging asset base. The company's investments in property and equipment are increasing, but the continued aging of assets could have implications for future maintenance costs and capital replacement requirements.
Estimated Total Useful Life
Based on: 10-K (reporting date: 2024-12-31), 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).
2024 Calculations
1 Estimated total useful life = Property and equipment, cost ÷ Property and equipment depreciation and amortization expense
= ÷ =
- Property and equipment cost
- The property and equipment cost has exhibited a consistent upward trend over the five-year period. Starting at 9,780 million US dollars at the end of 2020, the cost increased annually, reaching 13,410 million US dollars by the end of 2024. This steady growth suggests ongoing investment in acquiring and expanding physical assets.
- Depreciation and amortization expense
- The depreciation and amortization expense shows some variability across the years. It increased from 1,247 million US dollars in 2020 to a peak of 1,476 million US dollars in 2023. However, it decreased to 1,269 million US dollars in 2024. This fluctuation may reflect changes in asset composition, adjustments in depreciation methods, or variations in asset age distribution.
- Estimated total useful life
- The estimated total useful life of the property and equipment remained constant at 8 years from 2020 through 2023 but increased significantly to 11 years in 2024. This extension in useful life estimates likely impacts the depreciation expense, contributing to the reduction observed in 2024 despite the increased asset base.
Estimated Age, Time Elapsed since Purchase
Based on: 10-K (reporting date: 2024-12-31), 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).
2024 Calculations
1 Time elapsed since purchase = Accumulated depreciation and amortization ÷ Property and equipment depreciation and amortization expense
= ÷ =
- Accumulated Depreciation and Amortization
- The accumulated depreciation and amortization figures demonstrate a consistent upward trend from 5,575 million US dollars in 2020 to 9,454 million US dollars in 2024. This steady increase reflects ongoing wear and tear or obsolescence of property and equipment assets over time.
- Property and Equipment Depreciation and Amortization Expense
- The depreciation and amortization expense fluctuates between periods. It rose from 1,247 million US dollars in 2020 to a peak of 1,476 million in 2023, before declining to 1,269 million in 2024. This variation could imply changes in the asset base's composition or the adoption of different depreciation methods or schedules.
- Time Elapsed Since Purchase
- The average time elapsed since asset purchase shows a gradual increase from 4 years in 2020 to 7 years by 2024. This indicates that, on average, the asset base is aging, which may influence maintenance costs, depreciation rates, and strategies for capital expenditure.
- Overall Analysis
- The data collectively suggest an aging property and equipment portfolio with accumulated depreciation steadily rising. The depreciation expense exhibits some volatility, which could be related to asset write-offs, acquisitions, or changes in accounting policies. The increase in the average age of assets may require attention to asset replacement or refurbishment planning to sustain operational efficiency.
Estimated Remaining Life
Based on: 10-K (reporting date: 2024-12-31), 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).
2024 Calculations
1 Estimated remaining life = Property and equipment, net carrying value ÷ Property and equipment depreciation and amortization expense
= ÷ =
- Net carrying value of property and equipment
- The net carrying value shows a declining trend from 2020 through 2022, decreasing from 4205 million US dollars to 3774 million US dollars. This decline slows and slightly reverses in 2023 and 2024, with values increasing to 3871 million and 3956 million US dollars, respectively, indicating a potential stabilization or modest growth after the initial reduction.
- Depreciation and amortization expense
- Depreciation and amortization expense increased from 1247 million US dollars in 2020 to a peak of 1476 million US dollars in 2023. However, it declined in 2024 to 1269 million US dollars. This pattern suggests rising expense pressure until 2023, followed by a notable reduction, which could be attributed to adjustments in asset base or changes in depreciation policies.
- Estimated remaining life of assets
- The estimated remaining life has remained constant at 3 years throughout the period under review. This consistency indicates stable assumptions regarding the useful life of the property and equipment assets, with no revisions influencing the amortization schedules.
- Overall assessment
- The financial data for property and equipment reflect an initial period of asset value reduction followed by a modest increase, concurrent with fluctuating depreciation charges. The steady remaining asset life underscores consistent asset management policies. The recent decrease in depreciation expense, despite the slight increase in net carrying value, may suggest recent capital expenditures or revaluation activities impacting the asset base and expense recognition.