Analysis of Property, Plant and Equipment
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- Analysis of Short-term (Operating) Activity Ratios
- Enterprise Value to EBITDA (EV/EBITDA)
- Present Value of Free Cash Flow to Equity (FCFE)
- Selected Financial Data since 2005
- Return on Assets (ROA) since 2005
- Current Ratio since 2005
- Debt to Equity since 2005
- Total Asset Turnover since 2005
- Price to Sales (P/S) since 2005
- Analysis of Debt
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Property, Plant and Equipment Disclosure
Devon Energy Corp., balance sheet: property, plant and equipment
US$ in millions
Based on: 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), 10-K (reporting date: 2018-12-31).
- Proved Reserves
- The value of proved reserves experienced a sharp decline from 46,805 million USD in 2018 to 27,668 million USD in 2019. This level remained relatively stable in 2020 at 27,589 million USD before increasing significantly in 2021 and 2022, reaching 38,051 million USD and 42,734 million USD respectively.
- Unproved and Properties Under Development
- There was a considerable reduction in unproved and properties under development from 2,267 million USD in 2018 to 583 million USD in 2019, followed by a further decline to 392 million USD in 2020. In 2021 and 2022, investment in this category rebounded, rising to 1,081 million USD and 1,548 million USD respectively, indicating renewed development activity.
- Oil and Gas Properties
- The total value of oil and gas properties followed a trend similar to the proved reserves, decreasing sharply from 49,072 million USD in 2018 to 28,251 million USD in 2019, then remaining relatively stable in 2020. This figure increased in 2021 and 2022, reaching 39,132 million USD and 44,282 million USD correspondingly, reflecting growth in core asset valuations.
- Other Property and Equipment
- This category showed a gradual decline from 1,832 million USD in 2018 to 1,725 million USD in 2019, with slight fluctuations thereafter. The amounts stood at 1,737 million USD in 2020, increasing to 2,139 million USD in 2021 and 2,280 million USD in 2022, indicating modest growth in non-core physical assets.
- Property and Equipment, Gross
- The gross value of property and equipment mirrored the trends in oil and gas properties, showing a steep decrease from 50,904 million USD in 2018 to 29,976 million USD in 2019, with minor change in 2020. A subsequent recovery is evident, with values climbing to 41,271 million USD in 2021 and 46,562 million USD in 2022, suggesting renewed capital expenditure or asset revaluations.
- Accumulated Depreciation, Depletion, and Amortization (DD&A)
- The accumulated DD&A exhibited an overall increasing trend in absolute terms, starting at -36,969 million USD in 2018, then improving to a lower absolute level of -21,383 million USD in 2019. The figure increased again to -24,325 million USD in 2020 and continued to rise to -28,263 million USD in 2021 and -28,456 million USD in 2022. This pattern reflects ongoing depreciation and amortization consistent with asset utilization and lifecycle.
- Property and Equipment, Net
- Net property and equipment values declined markedly from 13,935 million USD in 2018 to 8,593 million USD in 2019, followed by a further sharp decrease to 5,393 million USD in 2020. Thereafter, a substantial rebound is noted with net values rising to 15,008 million USD in 2021 and further to 18,106 million USD in 2022. This recovery aligns with the increased gross asset base and may indicate asset additions or revaluation exceeding the impact of accumulated DD&A.
Asset Age Ratios (Summary)
Devon Energy Corp., asset age ratios
Based on: 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), 10-K (reporting date: 2018-12-31).
- Average Age Ratio
- Over the five-year period ending in 2022, the average age ratio of property, plant, and equipment demonstrates notable fluctuations. The ratio started at 72.62% in 2018 and experienced a slight decrease to 71.33% in 2019. In 2020, there was a significant increase to 81.85%, indicating an aging asset base during that year.
- However, this trend reversed in the subsequent years, with the ratio decreasing sharply to 63.64% in 2021 and further to 61.11% in 2022. This decline suggests either the acquisition of newer assets or the retirement of older assets, leading to a relatively younger property, plant, and equipment portfolio by the end of the period.
- Overall, the data reflects a pattern where the asset base aged through 2020 but was renewed or modernized in the following two years, improving the average age profile as of the latest reporting date.
Average Age
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Accumulated DD&A | ||||||
| Property and equipment, gross | ||||||
| Asset Age Ratio | ||||||
| Average age1 | ||||||
Based on: 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), 10-K (reporting date: 2018-12-31).
2022 Calculations
1 Average age = 100 × Accumulated DD&A ÷ Property and equipment, gross
= 100 × ÷ =
- Accumulated Depreciation, Depletion, and Amortization (DD&A)
- There was a significant decrease in accumulated DD&A from 2018 to 2019, dropping from approximately 36.97 billion USD to 21.38 billion USD. Following this decline, the accumulated DD&A showed a steady upward trend, increasing each year through 2022, reaching about 28.46 billion USD. This pattern indicates a major reduction in accumulated expenses in 2019, followed by gradual increases likely due to ongoing asset usage and amortization.
- Property and Equipment, Gross
- The gross value of property and equipment experienced a sharp decline from nearly 50.9 billion USD in 2018 to around 29.98 billion USD in 2019. Between 2019 and 2020, the value remained relatively stable, showing a minor decrease. However, substantial increases occurred from 2020 onward, with the gross value rising to approximately 41.27 billion USD in 2021 and further to 46.56 billion USD in 2022. This trend suggests a period of asset disposals or impairments initially, followed by considerable investments or acquisitions in property and equipment during the later years.
- Average Age Ratio
- The average age ratio of property and equipment started at 72.62% in 2018 and showed a slight decline to 71.33% in 2019. In 2020, this ratio increased significantly to 81.85%, indicating an aging asset base during that year. Subsequently, the average age ratio decreased notably to 63.64% in 2021 and further to 61.11% in 2022. The reduction in the ratio over the last two years suggests the addition of newer assets, thereby lowering the overall average age of the property and equipment portfolio.