Analysis of Property, Plant and Equipment
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- Enterprise Value (EV)
- Enterprise Value to EBITDA (EV/EBITDA)
- Enterprise Value to FCFF (EV/FCFF)
- Present Value of Free Cash Flow to Equity (FCFE)
- Selected Financial Data since 2005
- Return on Assets (ROA) since 2005
- Total Asset Turnover since 2005
- Price to Earnings (P/E) since 2005
- Price to Book Value (P/BV) since 2005
- Analysis of Revenues
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Property, Plant and Equipment Disclosure
Eli Lilly & Co., balance sheet: property, plant and equipment
US$ in thousands
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Land | |||||||||||
| Buildings | |||||||||||
| Equipment | |||||||||||
| Construction in progress | |||||||||||
| Property and equipment, gross | |||||||||||
| Accumulated depreciation | |||||||||||
| Property and equipment, net |
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).
- Land
- The value of land shows a consistent upward trajectory over the five-year period, increasing from approximately 227 million USD in 2020 to 382 million USD in 2024. This reflects a steady accumulation or revaluation of land assets with a notable acceleration in growth particularly from 2022 onwards.
- Buildings
- Building assets exhibit a continuous increase year over year, rising from about 7.33 billion USD in 2020 to nearly 8.81 billion USD in 2024. The growth rate remains relatively stable, indicating ongoing investments or valuation adjustments in the company’s structural facilities.
- Equipment
- Equipment values also demonstrate a steady increase from roughly 8.56 billion USD in 2020 to approximately 11.46 billion USD in 2024. This consistent upward trend suggests sustained capital expenditure directed towards acquiring or upgrading machinery and equipment.
- Construction in progress
- This category shows the most significant relative increase, growing from about 2.14 billion USD in 2020 to over 8.24 billion USD in 2024. The large year-over-year jumps, especially from 2022 onwards, indicate intensifying development projects or expansions not yet completed, potentially signaling future enhancements in productive capacity.
- Property and equipment, gross
- The gross property and equipment balances reflect the cumulative additions in all asset categories, expanding substantially from around 18.25 billion USD in 2020 to nearly 28.89 billion USD in 2024. This consistent growth aligns with observed increases in individual asset classes and highlights an overall expansion in fixed asset holdings.
- Accumulated depreciation
- Accumulated depreciation rises from approximately -9.57 billion USD in 2020 to nearly -11.79 billion USD by 2024, reflecting the increasing allocation of depreciation expenses over time as assets age. The increase in depreciation, although substantial, grows at a slower pace relative to asset additions, suggesting expansion in new assets outpacing the aging and usage of existing ones to some extent.
- Property and equipment, net
- The net property and equipment figures, representing the book value after depreciation, show a robust upwards trend from about 8.68 billion USD in 2020 to around 17.10 billion USD in 2024. This near doubling in net asset value signals significant capital investment and asset growth, as well as effective asset management despite ongoing depreciation.
Asset Age Ratios (Summary)
Eli Lilly & Co., 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 decline over the analyzed periods, decreasing from 53.09% in 2020 to 41.35% by 2024. This trend indicates that the property, plant, and equipment are becoming relatively younger in terms of their usage life. The decreasing ratio suggests a potential shift toward newer assets or a faster turnover of existing assets.
- Estimated Total Useful Life
- The estimated total useful life of the assets has increased steadily from 24 years in 2020 and 2021 to 27 years by 2024. This gradual increase may reflect a reassessment of asset longevity or improvements in asset quality and maintenance practices.
- Estimated Age, Time Elapsed Since Purchase
- The estimated age of the assets remained stable at 13 years from 2020 through 2022 but then exhibited a slight decrease to 12 years in 2023 and further to 11 years in 2024. This decline aligns with the observed reduction in the average age ratio and suggests asset renewal activities, possibly through acquisitions or retirements of older equipment.
- Estimated Remaining Life
- Corresponding with the trends in estimated total useful life and average asset age, the estimated remaining life has increased from 11 years in 2020 and 2021 to 16 years in 2024. This increase signals an improving outlook on the duration the assets are expected to remain useful, which could positively impact future depreciation expenses and operational capabilities.
Average Age
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Accumulated depreciation | ||||||
| Property and equipment, gross | ||||||
| Land | ||||||
| Asset Age Ratio | ||||||
| Average age1 | ||||||
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 ÷ (Property and equipment, gross – Land)
= 100 × ÷ ( – ) =
- Accumulated Depreciation
- The accumulated depreciation shows a consistent upward trend over the five-year period, increasing from approximately 9.57 billion US dollars in 2020 to nearly 11.79 billion US dollars in 2024. This reflects a steady allocation of depreciation expenses, indicating ongoing usage and aging of property, plant, and equipment assets.
- Property and Equipment, Gross
- The gross value of property and equipment exhibits a marked growth trajectory, rising from about 18.25 billion US dollars in 2020 to nearly 28.89 billion US dollars in 2024. This represents a substantial investment in physical assets, with an especially notable increase between 2022 and 2024, suggesting significant capital expenditure during the latter years.
- Land
- Land assets have increased steadily from 226.8 million US dollars in 2020 to 382 million US dollars in 2024. This gradual growth denotes ongoing acquisitions or revaluations of land holdings, contributing to the overall expansion of fixed assets.
- Average Age Ratio
- The average age ratio has decreased progressively from 53.09% in 2020 to 41.35% in 2024. This decline signals a younger fixed asset base over time, likely due to the significant additions of new property and equipment, thereby reducing the relative aging effect on the asset portfolio.
- Overall Insights
- The data reflects a scenario of substantial asset growth accompanied by continuous depreciation. The considerable increases in gross property and equipment values and land holdings, combined with a decreasing average age ratio, suggest active investment in renewing and expanding the company's operational infrastructure. This pattern indicates a strategic focus on maintaining asset modernity and capacity expansion.
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, gross – Land) ÷ Depreciation expense
= ( – ) ÷ =
- Property and equipment, gross
- The gross value of property and equipment exhibited a consistent upward trend from 2020 to 2024. Starting at approximately 18.25 billion US dollars in 2020, the figure increased each year, reaching nearly 28.89 billion US dollars by 2024. This steady growth indicates ongoing investments or acquisitions in property and equipment assets over the period analyzed.
- Land
- The recorded value of land assets also showed a rising trajectory throughout the five-year period. Beginning at about 227 million US dollars in 2020, the value experienced a modest increase through 2021 and 2022, followed by a more noticeable rise in 2023 and 2024, where it climbed to approximately 382 million US dollars. This pattern suggests targeted expansion or revaluation of land holdings during the latter years.
- Depreciation expense
- Depreciation expense showed a consistent incremental increase each year. From 765.2 million US dollars in 2020, the expense rose steadily to reach 1.058 billion US dollars by 2024. The increase in depreciation expense corresponds logically with the growth in gross property and equipment, reflecting the higher asset base subject to depreciation.
- Estimated total useful life
- The estimated total useful life of property and equipment demonstrated a gradual upward adjustment over the years. Initially stable at 24 years for 2020 and 2021, the estimate extended to 25 years in 2022, progressing to 26 and 27 years in 2023 and 2024 respectively. This trend suggests a reassessment of asset longevity, potentially indicating improvements in asset quality, usage practices, or maintenance efficiencies.
- Overall insights
- The data reflect a strategic expansion in property, plant, and equipment assets, supported by consistent increases in related depreciation expenses. The lengthening in estimated useful life may temper the impact of asset additions on annual depreciation, implying a balanced approach between asset growth and cost management. The rising land values particularly stand out as a component of the total asset base, potentially signaling land acquisition as part of growth strategy.
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 ÷ Depreciation expense
= ÷ =
- Accumulated Depreciation
- The accumulated depreciation figures show a consistent upward trend from 9,570,700 thousand US dollars in 2020 to 11,789,000 thousand US dollars in 2024. This increase indicates a growing total depreciation charge over time, reflecting ongoing utilization and aging of the property, plant, and equipment assets.
- Depreciation Expense
- Annual depreciation expense has steadily increased each year, starting at 765,200 thousand US dollars in 2020 and rising to 1,058,000 thousand US dollars in 2024. The rising depreciation expense suggests either additions to depreciable assets or changes in depreciation methods or useful lives. The increment is more pronounced in 2023 and 2024, potentially indicating accelerated depreciation or significant asset acquisition.
- Time Elapsed Since Purchase
- The time elapsed since purchase remains relatively constant at 13 years from 2020 through 2022, then decreases to 12 years in 2023 and 11 years in 2024. This decreasing trend suggests the addition of newer assets, reducing the average age of the asset base.
- Overall Insights
- The data indicates the company is managing an asset base where the accumulated depreciation continues to grow, consistent with long-term asset use. Meanwhile, rising depreciation expenses and a decrease in average asset age imply recent investments in property, plant, and equipment. This combination reflects ongoing capital expenditure activity and asset renewal, which may affect future operational capacity and expense profiles.
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 – Land) ÷ Depreciation expense
= ( – ) ÷ =
- Property and Equipment, Net
- The net value of property and equipment shows a consistent upward trend over the five-year period. Starting at approximately $8.68 billion in 2020, it increased steadily year over year, reaching $17.10 billion by the end of 2024. The growth rate appears to accelerate notably between 2022 and 2024, indicating significant investments or capital expenditures in these latter years.
- Land
- Land holdings in monetary terms demonstrate a gradual increase from $226.8 million in 2020 to $382 million in 2024. There was a slight dip in 2022; however, the overall trajectory remains positive, reflecting possible acquisitions or revaluations of land assets.
- Depreciation Expense
- Depreciation expense has increased steadily throughout the period. Starting at $765.2 million in 2020, it rose incrementally each year, surpassing $1 billion in 2024. This trend aligns with the rising net property, plant, and equipment balances, indicating higher capital assets being depreciated over time.
- Estimated Remaining Life of Property and Equipment
- The estimated remaining useful life of property and equipment assets has extended from 11 years in 2020 and 2021 to 16 years by 2024. This increase suggests improvements in asset longevity, changes in asset composition, or revisions in management's estimates regarding the service life of these assets.
- Summary of Trends and Insights
- The data demonstrates substantial growth in property, plant, and equipment value, supported by rising land values and increased depreciation expenses. The elongation of the estimated remaining life implies a strategic approach to asset management, possibly reflecting newer acquisitions with longer useful lives or enhanced maintenance practices. The acceleration in asset base growth from 2022 onward suggests an emphasis on expanding operational capacity or modernizing facilities leading into 2024.