Eaton Corp. plc (NYSE:ETN)

Net Sales

The net sales for the Electrical Americas segment exhibited a consistent upward trend from 2020 through 2024. Starting at $6,680 million in 2020, sales increased annually, reaching $11,436 million in 2024. This steady growth indicates strong market demand and/or successful expansion strategies over the five-year period.

Segment Operating Profit

Operating profit also demonstrated considerable growth over the same period. The profit increased from $1,352 million in 2020 to $3,455 million in 2024, showing a significant upward trajectory. This rise suggests not only increased revenue but likely improved operational efficiencies or cost management contributing to higher profitability.

Segment Profit Margin

The segment profit margin improved notably each year, rising from 20.24% in 2020 to 30.21% in 2024. This increase in margin percentage reflects enhanced profitability relative to sales, potentially due to factors such as better pricing strategies, reduced costs, or a more favorable sales mix within the segment.

Overall Analysis

The data reveals a positive and robust financial performance trend within the Electrical Americas segment. Both sales and operating profit exhibit sustained growth, with profit advancing at a faster rate than sales, as evidenced by expanding margins. This pattern indicates effective management in scaling the business while improving profitability. The increasing profit margin highlights improvements in operational leverage, supporting a more profitable and sustainable business model moving forward.

Operating Profit

Operating profit demonstrated a positive trend from 2020 to 2023, increasing steadily from $750 million to $1,176 million. However, in 2024, there was a slight decline to $1,149 million, indicating a marginal reduction in profitability after several years of growth.

Net Sales

Net sales consistently increased over the five-year period, rising from $4,703 million in 2020 to $6,248 million in 2024. This reflects sustained growth in revenue for the segment, with no year showing a decrease or stagnation.

Segment Profit Margin

The segment profit margin showed an upward trend from 15.95% in 2020 to a peak of 19.39% in 2022. After maintaining a high margin through 2023 at 19.33%, the margin slightly declined to 18.39% in 2024. Despite this slight decrease, the margin remains significantly higher than the initial 2020 figure, indicating improved operational efficiency or pricing power over the period.

Overall Analysis

The segment exhibited robust growth in both sales and operating profit from 2020 through 2023. Although the operating profit and profit margin decreased slightly in 2024, the values remain elevated compared to 2020, suggesting that the segment has strengthened its profitability. The consistent increase in net sales supports a positive outlook, although the recent small declines in profit measures may warrant closer examination of cost structures or market conditions affecting margin sustainability.

Net Sales

Net sales in the Hydraulics segment showed a notable decline from 1,842 million US dollars at the end of 2020 to 1,300 million US dollars at the end of 2021. Data for subsequent years are not available, so trends beyond 2021 cannot be assessed.

Segment Operating Profit (Loss)

The segment operating profit decreased slightly from 186 million US dollars at the end of 2020 to 177 million US dollars at the end of 2021. Information for the following years is not provided, limiting the ability to analyze further changes or recovery.

Segment Profit Margin

The profit margin increased from 10.1% at the end of 2020 to 13.62% at the end of 2021 despite the decline in net sales and operating profit in absolute terms. This indicates improved profitability on sales, suggesting better cost management or pricing strategies during this period. No data is available for the following years.

Overall Analysis

Between 2020 and 2021, the Hydraulics segment experienced a decline in sales and operating profit, but an improvement in profit margin percentage, indicating a more efficient use of revenues. The absence of data for subsequent years precludes analysis of ongoing performance trends or impact of external factors beyond 2021.

Segment Operating Profit (Loss)

The segment operating profit has shown a consistent upward trend over the five-year period. Starting from US$414 million in 2020, it increased to US$580 million in 2021, followed by further rises to US$705 million in 2022, US$780 million in 2023, and reaching US$859 million in 2024. This steady growth indicates improving profitability within the segment.

Net Sales

Net sales have demonstrated continuous growth throughout the period. Beginning at US$2,223 million in 2020, sales rose to US$2,648 million in 2021, then advanced to US$3,039 million in 2022. This positive trajectory continued with US$3,413 million in 2023 and US$3,744 million in 2024, reflecting an expanding revenue base and possibly increased demand or market share.

Segment Profit Margin

The segment profit margin also showed a general improvement over the years. It started at 18.62% in 2020, increased notably to 21.9% in 2021, and further to 23.2% in 2022. Although there was a slight decrease to 22.85% in 2023, the margin rose again marginally to 22.94% in 2024. Overall, the segment has maintained healthy profitability levels relative to sales, with margins consistently above 18% and mostly exceeding 22% from 2021 onwards.

Overall Insights

The data indicates robust growth in both top-line and operating profit figures for the segment over the five-year period, with operating profit growing at a rate comparable to or slightly outpacing revenue growth. The profit margin improvements suggest enhanced operational efficiency or favorable pricing conditions. Despite a minor margin dip in 2023, the segment sustained strong profitability through 2024, reinforcing the positive financial performance trend.

The data reveals a generally positive trend in the financial performance of the vehicle segment over the observed period.

Segment Operating Profit (Loss)

The segment operating profit exhibits consistent growth from 243 million USD in 2020 to 502 million USD in 2024, more than doubling over the five-year span. This indicates steady improvement in operational efficiency or profitability within the segment.

Net Sales

Net sales increased from 2,118 million USD in 2020 to a high of 2,965 million USD in 2023, demonstrating strong revenue growth over four years. However, there is a noticeable decline to 2,790 million USD in 2024, suggesting a potential slowdown or market contraction in that final year.

Segment Profit Margin

The segment profit margin improved markedly from 11.47% in 2020 to 17.41% in 2021, indicating enhanced profitability early in the period. It then slightly declined to 16.01% in 2022 but recovered to 16.26% in 2023 and further to 17.99% in 2024. Overall, the segment maintained higher profitability margins in the latter years compared to the beginning of the period.

In summary, despite the slight revenue contraction in 2024, the segment shows strong upward trends in both operating profit and profit margin, reflecting effective cost management or value improvements that bolster profitability. The growth in profitability margins alongside revenue expansion and later stabilization suggests resilience and potential operational strengths within the segment.

The segment operating profit (loss) for the eMobility segment demonstrates a fluctuating pattern over the analyzed period. Starting with a loss of US$ 8 million at the end of 2020, the loss increased significantly to US$ 29 million in 2021. This was followed by a reduction in losses to US$ 9 million in 2022, an increase again to US$ 21 million in 2023, and then a substantial improvement to a loss of US$ 7 million in 2024, indicating some recovery towards the end of the period.

Net sales show a consistent and robust upward trend throughout the years. Beginning at US$ 292 million in 2020, net sales increased steadily to US$ 343 million in 2021 and then accelerated sharply to US$ 538 million in 2022. The growth trajectory continued with sales rising to US$ 636 million in 2023 and reaching US$ 662 million in 2024, reflecting a strong and persistent increase in revenue generation within the segment.

The segment profit margin follows a variable but generally negative trajectory. The margin started at -2.74% in 2020, deteriorated significantly to -8.45% in 2021, then improved markedly to -1.67% in 2022. In 2023, the margin again worsened to -3.3% but showed improvement in 2024, closing at -1.06%. This pattern reflects ongoing challenges in achieving profitability despite increasing sales, with some signs of margin recovery in the most recent period.

Overall Observations

The data reveals that while the eMobility segment has been experiencing steady growth in net sales, it has struggled to translate this revenue growth into positive segment operating profit. Operating losses have been consistent but show a notable reduction in 2024, possibly indicating improvements in cost management or operational efficiency.

The profit margin trend parallels operating profit losses, confirming the presence of negative profitability throughout the period. Although margins remain negative, the improvement in 2024 suggests a shift towards a more sustainable business model. The significant spike in loss during 2021 and the partial recovery thereafter warrant further investigation into operational factors and market conditions affecting the segment during those years.

Segment Operating Profit (Loss)

There is a consistent upward trend in segment operating profit from 2020 to 2024. The profit increased from US$1,352 million in 2020 to US$3,455 million in 2024, showing strong growth each year. The most notable increase occurred between 2022 and 2023, where the segment operating profit rose by approximately 40%, suggesting improved operational efficiency or increased sales.

Identifiable Assets

Identifiable assets also show a steady increase over the analyzed periods. The assets grew from US$2,333 million in 2020 to US$4,933 million in 2024, reflecting investments or acquisitions within the segment. The growth indicates expansion or enhancement of the asset base to support the increasing operations of the segment.

Segment Return on Assets (ROA)

The segment ROA experienced some variability but overall displayed an upward trajectory. Starting at 57.95% in 2020, it dipped to 49.8% in 2021 but rebounded to 70.04% by 2024. This improvement indicates increasing profitability relative to the asset base, suggesting better utilization of assets over time to generate profit.

Segment operating profit (loss)

The segment operating profit demonstrated a consistent upward trend from 2020 through 2023, increasing from $750 million to a peak of $1,176 million. However, in 2024, a slight decline to $1,149 million was observed, indicating a minor contraction after several years of growth.

Identifiable assets

Identifiable assets within the segment showed a steady increase over the five-year period. Starting at $2,334 million in 2020, assets grew annually to reach $3,233 million by the end of 2024. This reflects sustained investment or accumulation of assets within the segment.

Segment return on assets (ROA)

The segment ROA exhibited notable volatility. It rose significantly from 32.13% in 2020 to a high of 42.66% in 2022, suggesting improved efficiency and profitability relative to assets. However, this measure declined to 41% in 2023 and further to 35.54% in 2024, indicating a reduction in asset utilization effectiveness despite growing asset base and high operating profit levels.

Overall, the segment showed strong profit growth and asset expansion over the period, but the declining return on assets in the last two years suggests that increases in asset size have not been matched proportionally by operating profit improvements, hinting at potential inefficiencies or changing market conditions affecting performance.

The available data on the hydraulics reportable segment indicates the following trends over the observed period:

Segment Operating Profit (Loss)

The operating profit for the segment showed a slight decline from 186 million US dollars at the end of 2020 to 177 million US dollars at the end of 2021. Data for subsequent years is missing, preventing trend analysis beyond 2021. The initial decline may suggest some challenges impacting profitability during that period, though the limited data restricts further interpretation.

Identifiable Assets

No data is available for identifiable assets for any of the years, hence no analysis on asset trends or asset base evolution can be conducted.

Segment Return on Assets (ROA)

The segment ROA information is also absent for all years, limiting the ability to assess asset efficiency or profitability relative to assets.

Overall, the analysis reveals a modest decrease in operating profit from 2020 to 2021 with no additional financial metrics reported to provide further context or to demonstrate trends in asset utilization or profitability dynamics in subsequent years. The incomplete dataset inhibits a comprehensive assessment of the segment's financial performance over the full period.

Segment operating profit

The Aerospace segment demonstrates a consistent upward trend in operating profit over the five-year period. Starting at $414 million in 2020, the profit increased steadily each year, reaching $859 million by 2024. This represents more than a doubling of operating profit, indicating robust growth and improved operational efficiency within the segment.

Identifiable assets

Identifiable assets for the segment also show a clear increasing trend, growing from $1,363 million in 2020 to $2,392 million in 2024. This steady increase suggests ongoing investment and expansion of the segment’s asset base, which may support the higher operating profits observed. The growth in assets is consistent year-over-year, except for a slightly larger increase between 2022 and 2023.

Segment Return on Assets (ROA)

The segment ROA exhibits some variability but remains generally strong throughout the period. It started at 30.37% in 2020 and rose to a peak of 37.92% in 2022, before slightly declining to 34.27% in 2023 and then increasing again to 35.91% in 2024. Overall, the ROA indicates effective asset utilization, with the segment maintaining returns above 30% consistently, reflecting a high level of profitability relative to its asset base.

Summary

Across the observed period, the segment shows sustained growth in operating profit and identifiable assets, accompanied by strong and relatively stable returns on assets. This pattern suggests efficient management of resources and a positive operational performance trend within the Aerospace segment.

The vehicle segment displays several important trends across the five-year period ending December 31, 2024. There is a clear upward trajectory in segment operating profit, which increases steadily from $243 million in 2020 to $502 million in 2024. This represents more than a doubling of operating profit over the period, indicating improved profitability and operational efficiency in this segment.

Identifiable assets within the segment exhibit a contrasting pattern. Initially, total identifiable assets grow from $1950 million in 2020 to a peak of $2251 million in 2023. However, in the final year, 2024, assets decline notably to $1987 million. This reduction after several years of increase may suggest divestitures, asset revaluations, or changes in capital deployment strategies.

The segment return on assets (ROA) demonstrates strong and generally increasing performance, rising from 12.46% in 2020 to 25.26% in 2024. Despite a slight dip in 2022 and 2023 compared to 2021, the overall upward trend in ROA reflects enhanced efficiency in utilizing assets to generate profit. The peak ROA of 25.26% in 2024 coincides with the reduction in identifiable assets, implying that the segment is achieving greater profitability from a smaller asset base.

In summary, the data indicates significant growth in profitability, a temporary build-up and subsequent reduction in assets, and an improving efficiency in asset utilization within the vehicle segment over the five-year span. These trends collectively suggest a strategic focus on optimizing operations and asset base to sustain higher returns going forward.

Segment Operating Profit (Loss)

The segment operating profit exhibited fluctuations over the five-year period. Initially, there was a loss of $8 million in 2020, which deepened significantly to a loss of $29 million in 2021. This was followed by a partial recovery in 2022 with a reduced loss of $9 million. However, the operating profit declined again in 2023 to a loss of $21 million before improving to a loss of $7 million in 2024. Despite the persistent negative values, the most recent data suggests a trend toward narrowing losses.

Identifiable Assets

Identifiable assets showed a consistent and substantial increase over the five-year timeframe. Starting from $180 million in 2020, assets expanded by 22% in 2021 to $220 million, then experienced a significant jump to $402 million in 2022, representing an 83% increase. This upward trajectory continued with assets reaching $563 million in 2023 and $633 million in 2024. The asset base more than tripled from 2020 to 2024, indicating considerable investment or asset accumulation within the segment.

Segment Return on Assets (ROA)

The segment ROA remained negative throughout the period, reflecting ongoing operational losses relative to asset size. The lowest ROA was recorded in 2021 at -13.18%, coinciding with the highest operating loss. Following 2021, the ROA improved steadily, moving to -2.24% in 2022, slightly decreased to -3.73% in 2023, and then improved again to -1.11% in 2024. This trend indicates gradual progress in asset utilization efficiency, albeit still resulting in a negative return.

Net Sales

Net sales displayed a consistent upward trend over the five-year period. Starting at $6,680 million in 2020, sales increased annually, reaching $11,436 million by 2024. This represents a total growth of approximately 71% over the span of five years, with notable acceleration in growth between 2021 and 2023.

Identifiable Assets

Identifiable assets also showed steady growth throughout the period. The asset base increased from $2,333 million in 2020 to $4,933 million in 2024, more than doubling in size. This suggests ongoing investments or acquisitions that expanded the asset pool in the Electrical Americas segment.

Segment Asset Turnover

The segment asset turnover ratio, which measures the efficiency of asset use to generate revenue, experienced some fluctuations. It declined from 2.86 in 2020 to 2.32 in 2022, indicating reduced efficiency in asset utilization. In 2023, there was a slight recovery to 2.43, before returning to 2.32 in 2024. Overall, asset turnover decreased compared to 2020, implying that while sales grew, asset growth outpaced sales growth, leading to lower relative asset efficiency.

Net Sales

Net sales exhibited a consistent upward trajectory over the five-year period. Starting at 4,703 million USD in 2020, sales increased annually to reach 6,248 million USD by the end of 2024. This represents a cumulative growth trend, although the year-over-year increments appear to moderate slightly in the latter years.

Identifiable Assets

The identifiable assets also experienced steady growth throughout the observed period. From 2,334 million USD at the end of 2020, assets rose progressively each year, culminating at 3,233 million USD by the close of 2024. This consistent increase suggests ongoing investment or asset accumulation aligned with business expansion.

Segment Asset Turnover

The segment asset turnover ratio, which measures the efficiency of asset use to generate sales, showed some variability. Beginning at 2.01 in 2020, the ratio improved slightly to a peak of 2.20 in 2022, reflecting enhanced efficiency during this period. However, from 2023 onward, the ratio declined to 2.12 and then further to 1.93 in 2024, indicating a reduction in the efficiency of asset utilization relative to sales despite the growth in net sales and assets.

The reported data for the Hydraulics segment shows that net sales experienced a significant decline from 2020 to 2021. Specifically, net sales decreased from USD 1,842 million in 2020 to USD 1,300 million in 2021. Data for net sales beyond 2021 is not provided, leaving the subsequent trend unclear.

Regarding identifiable assets and segment asset turnover, no quantitative information is available for any of the periods under review. The absence of these figures limits the ability to analyze the segment's asset base and efficiency in utilizing assets to generate sales over time.

Overall, the visible data indicates a marked reduction in net sales in 2021 compared to 2020. However, the lack of further numerical values for the following years and for other financial metrics constrains a comprehensive evaluation of the segment's performance and operational trends beyond this point.

Net Sales

Net sales demonstrate a consistent upward trend from 2020 through 2024, growing from $2,223 million to $3,744 million. This reflects a substantial increase in revenue, indicating strong market demand or expanded operations within the segment.

Identifiable Assets

Identifiable assets also increased over the period, rising from $1,363 million in 2020 to $2,392 million in 2024. The growth in assets suggests ongoing investment and expansion in the segment’s capacity or resources.

Segment Asset Turnover

The segment asset turnover ratio shows some variability but remains relatively stable, fluctuating between 1.50 and 1.63. The ratio started at 1.63 in 2020, dipped to 1.53 in 2021, recovered to 1.63 in 2022, then decreased to 1.50 in 2023, and rose slightly to 1.57 in 2024. This indicates that while asset efficiency experienced minor variance, it generally maintained a steady level of effectiveness in generating sales from the assets employed.

Overall Analysis

The combined data suggests that the segment has been managing growth in both sales and assets. Although the asset turnover ratio does not show a clear upward or downward trend, the consistent increase in net sales alongside growing identifiable assets indicates an expanding business that is maintaining reasonable efficiency in asset utilization. The slight fluctuations in the asset turnover ratio could be reflective of timing differences in asset investments or changes in operational productivity.

Net Sales

The net sales showed an overall increasing trend from 2020 to 2023, rising from 2,118 million US dollars in 2020 to a peak of 2,965 million US dollars in 2023. However, in 2024, net sales declined to 2,790 million US dollars, which represents a decrease after a period of consistent growth.

Identifiable Assets

Identifiable assets experienced moderate growth between 2020 and 2023, increasing from 1,950 million US dollars to 2,251 million US dollars. In 2024, there was a noticeable reduction to 1,987 million US dollars, indicating a contraction in assets after several years of expansion.

Segment Asset Turnover

The segment asset turnover ratio demonstrated a steady upward trajectory throughout the period, starting at 1.09 in 2020 and reaching 1.4 in 2024. This improvement suggests enhanced efficiency in using the segment’s assets to generate sales, even during the period when net sales and assets declined in 2024.

Overall Analysis

The data reflects a phase of growth in both net sales and assets from 2020 to 2023, followed by a slight reversal in 2024. Despite the decrease in both net sales and identifiable assets in 2024, the segment's asset turnover ratio continued to improve, indicating better utilization of assets during that year. This could imply operational improvements or strategic asset management contributing to sustained efficiency.

The analysis of the financial data over the period from the end of 2020 to the end of 2024 indicates several notable trends within the segment.

Net Sales

There is a consistent upward trend in net sales, increasing from $292 million in 2020 to $662 million in 2024. The growth is significant, with a particularly large increase observed between 2021 and 2022, where sales rose from $343 million to $538 million. Growth continues at a slower but steady pace through 2024.

Identifiable Assets

Identifiable assets have also shown robust growth, nearly tripling from $180 million in 2020 to $633 million in 2024. The largest increments occur between 2021 and 2023, indicating increased investment or asset accumulation in the segment. The growth in assets appears to support the expanding sales base.

Segment Asset Turnover

This ratio has exhibited a declining trend, falling from 1.62 in 2020 to 1.05 in 2024. This downward trajectory suggests that despite rising sales, the efficiency with which the segment uses its assets to generate revenue has diminished over time. The decline may reflect increasing asset investments that have not yet fully translated into proportional sales growth.

Overall, the segment shows strong sales growth supported by expanding assets; however, the decreasing asset turnover ratio indicates a potential reduction in operational efficiency or a strategic focus on longer-term asset buildup. This is a critical aspect for ongoing monitoring to ensure that asset growth continues to contribute effectively to revenue generation.

Analysis of the annual data for the Electrical Americas segment reveals notable trends in capital expenditures related to property, plant, and equipment, as well as in depreciation expenses over the five-year period from 2020 through 2024.

Capital Expenditures

There is a clear and substantial upward trend in capital expenditures, which increased from $95 million in 2020 to $362 million in 2024. This represents nearly a fourfold increase over the period. The largest single-year increase occurred between 2022 and 2023, where capital expenditures rose sharply from $181 million to $309 million. This suggests a significant intensification in investment into property, plant, and equipment during the most recent years.

Depreciation

Depreciation expenses remained relatively stable over the same period, fluctuating modestly between $101 million and $118 million. This stability indicates that while new investments were made, the overall expense related to the wear and amortization of existing assets did not drastically change. The slight uptick in depreciation by 2024, reaching $118 million, could be associated with the incremental accumulation of assets resulting from increased capital expenditure in prior years.

Capital Expenditures to Depreciation Ratio

The ratio of capital expenditures to depreciation has shown a significant rising trend, starting at 0.94 in 2020 and rising to 3.07 by 2024. This increasing ratio underscores the growing emphasis on asset growth and enhancement, as capital investments are outpacing the depreciation charges by over three times in 2024. This pattern reflects a phase of expansion or modernization within the segment’s property, plant, and equipment base.

Overall, the data reflects a strategic focus on increasing asset investments intensively during the observed years, with capital expenditure growth markedly outpacing depreciation expenses. This could indicate efforts to enhance operational capacity, upgrade facilities, or adopt new technologies within the Electrical Americas segment.

The financial data for the segment over the five-year period reveals key trends in capital investment and asset depreciation.

Capital Expenditures for Property, Plant and Equipment

The capital expenditures show a consistent upward trend from 2020 through 2024. Starting at $71 million in 2020, expenditures increased substantially to $120 million in 2021, followed by further growth to $151 million in 2022. Although there was a slight dip to $142 million in 2023, the expenditures rose again to reach $163 million in 2024. This pattern suggests a robust and sustained commitment to asset growth or renewal within the segment.

Depreciation of Property, Plant and Equipment

Depreciation expenses remained relatively stable across the period, fluctuating narrowly between $94 million and $102 million. After a slight rise from $94 million in 2020 to $97 million in 2021, depreciation dipped back to $94 million in 2022, then increased gradually to $96 million in 2023 and $102 million in 2024. This stability indicates a relatively steady base of depreciable assets, despite the increases in capital expenditures.

Segment Capital Expenditures to Depreciation Ratio

The ratio of capital expenditures to depreciation demonstrates a clear upward trend, indicating growing investment relative to the consumption of existing assets. The ratio moved from 0.76 in 2020, which suggests capital expenditures were lower than depreciation, to surpassing parity at 1.24 in 2021, and further increasing to 1.61 in 2022. Although there was a slight reduction to 1.48 in 2023, the ratio rose again to 1.6 in 2024. This increasing ratio denotes that the segment is investing more aggressively in property, plant, and equipment relative to the rate at which these assets are being depreciated.

Overall, the data implies a strategic focus on growth or renewal through increased capital expenditures, while depreciation figures indicate a stable asset base. The increasing capital expenditures to depreciation ratio reinforces the interpretation of elevated investment intensity in recent years.

The available data for the Hydraulics segment indicates a partial view of capital expenditures related to property, plant, and equipment over the years 2020 to 2024. Specifically, capital expenditures were reported as 41 million US dollars for the year ending December 31, 2020, then declined to 34 million US dollars by the end of 2021. The subsequent years, from 2022 to 2024, do not provide disclosed values, which limits the ability to analyze trends for these periods.

There is no data available for depreciation of property, plant, and equipment across all time points. Consequently, it is not possible to compute or analyze the capital expenditures to depreciation ratio, which would otherwise offer insights into the relationship between investment in fixed assets and the consumption of these assets over time.

Overall, the only observable trend is a decline in capital expenditures from 2020 to 2021, followed by a lack of information for subsequent years. This incomplete data restricts comprehensive trend analysis, making it difficult to assess the ongoing investment pattern or asset utilization efficiency within the Hydraulics segment.

The financial data for the Aerospace segment over the five-year period reveals several notable trends in capital expenditures and depreciation of property, plant, and equipment.

Capital expenditures

Capital expenditures generally increased from 59 million US dollars in 2020 to 97 million US dollars in 2023, indicating consistent investment in property, plant, and equipment during this period. However, there was a decline in 2024 to 83 million US dollars, suggesting a potential slowdown or shift in investment strategy.

Depreciation

Depreciation expenses rose from 53 million US dollars in 2020 to 69 million US dollars in 2021, then slightly declined to 64 million in 2022 before increasing again to 70 million in 2024. This pattern suggests some fluctuations in the asset base's aging or changes in depreciation methods, but overall depreciation has shown an upward trend consistent with increasing capital investment.

Capital expenditures to depreciation ratio

The ratio of capital expenditures to depreciation started at 1.11 in 2020, remained relatively stable at 1.13 in 2021, and increased significantly to 1.44 in 2022 and 1.41 in 2023. This rise implies that new investments were increasingly surpassing the charge for asset consumption, indicating asset base expansion. The ratio then decreased to 1.19 in 2024, aligning with the reduction in capital expenditures.

Overall, the segment demonstrated a proactive investment approach from 2020 through 2023, expanding its asset base as evidenced by rising capital expenditures outpacing depreciation. The decline in 2024 figures may reflect a strategic adjustment or completion of major asset projects during the prior years. Depreciation remained relatively stable with moderate increases, supporting a narrative of a maturing asset portfolio with ongoing additions.

The data reveals several key trends in capital expenditures and depreciation related to property, plant, and equipment within the vehicle segment over the five-year period from 2020 to 2024.

Capital Expenditures

Capital expenditures demonstrated an overall increasing trend from 2020 through 2021, climbing sharply from $77 million to $112 million. This was followed by a decline in 2022 to $95 million and remained relatively stable in the two subsequent years, with minor fluctuations of $96 million in 2023 and $94 million in 2024. The initial increase could suggest an investment phase which then transitioned into a period of steady spending on tangible assets.

Depreciation

Depreciation of property, plant, and equipment showed a gradual decrease from $98 million in 2020 to a low of $89 million in 2022. It subsequently reversed the downward trend, rising modestly in 2023 to $92 million and further to $95 million in 2024. This pattern may reflect changes in the asset base, potentially linked to the timing of capital investments and asset life cycles.

Segment Capital Expenditures to Depreciation Ratio

This ratio increased significantly from 0.79 in 2020 to 1.18 in 2021, indicating that capital expenditures notably outpaced depreciation that year. The ratio then declined steadily over the following years—1.07 in 2022, 1.04 in 2023, and 0.99 in 2024—approaching a balance where capital expenditure closely matched depreciation. The initial surge and subsequent decline in this ratio suggests a phase of asset growth followed by stabilization of investment in relation to asset wear and tear.

Overall, the data reflects an investment cycle characterized by an initial increase in capital spending above the level of depreciation, followed by a leveling off of expenditures closer to the depreciation rate. This pattern points to a maturing asset base after a period of expansion in the vehicle segment.

The analysis of the eMobility segment's capital expenditures and depreciation over the five-year period reveals several notable trends and insights into the company's investment and asset utilization strategy.

Capital Expenditures for Property, Plant and Equipment

The segment shows a general upward trend in capital expenditures from 2020 to 2023, with amounts increasing from $24 million in 2020 to a peak of $76 million in 2023. However, in 2024, there is a moderate decline to $64 million. This pattern suggests a significant ramp-up in investment activities particularly between 2021 and 2023, followed by a slight reduction, potentially indicating a shift towards stabilizing or optimizing existing assets.

Depreciation of Property, Plant and Equipment

Depreciation expenses have increased steadily throughout the period, rising from $6 million in 2020 to $24 million by the end of 2024. This consistent increase aligns with the historical capital investments, reflecting the aging of assets and ongoing allocation of costs associated with these fixed assets.

Segment Capital Expenditures to Depreciation Ratio

The ratio of capital expenditures to depreciation decreases overall from 4.0 in 2020 to 2.67 in 2024. Notably, this ratio peaks in 2020 at 4.0 indicating that capital spending was four times depreciation that year, then gradually declines with minor fluctuations reaching its lowest ratio in 2024. This trend indicates that while capital expenditure remains significant, its growth has not kept pace with depreciation, potentially signaling a maturing asset base where reinvestment is balancing with asset usage and wear.

In summary, the eMobility segment made substantial investments in property, plant, and equipment particularly through 2023, which subsequently tapered slightly in 2024. The rise in depreciation expenses corresponds with these investments, implying an expanding asset base. The declining capital expenditures to depreciation ratio suggests a shift from rapid growth towards maintenance and steady-state operations, reflecting a typical lifecycle progression of asset management within the segment.