Fidelity National Information Services Inc. (NYSE:FIS)

The financial data on property, plant, and equipment over the five-year period reveals several noteworthy trends and shifts in asset composition and valuation.

Land

The value of land held saw a gradual increase from 31 million US dollars in 2018 to a peak of 48 million in 2020. This was followed by a decline to 40 million by the end of 2022, indicating some divestment or revaluation in recent years.

Buildings

There is a consistent upward trend in the value of buildings, rising from 235 million in 2018 to 441 million in 2022. This suggests ongoing investment or acquisition of building assets, with the most significant increases observed between 2020 and 2022.

Leasehold Improvements

The leasehold improvements category peaked at 163 million in 2019 but then gradually declined to 135 million by 2022. This decrease may reflect amortization, dispositions, or a slowdown in leasing-related enhancements.

Computer Equipment

Computer equipment shows the most pronounced growth among individual asset categories, increasing from 1,047 million in 2018 to a high of 1,754 million in 2021, followed by a slight reduction to 1,642 million in 2022. This pattern indicates significant investment in technology infrastructure, with a stabilization or minor asset write-down in the most recent year.

Furniture, Fixtures, and Other Equipment

This category experienced considerable volatility, increasing sharply from 197 million in 2018 to 323 million in 2019, then sharply declining to 123 million by 2022. The downward trajectory after 2019 may point to asset disposals or an organizational shift away from this asset type.

Property and Equipment, Cost

The total cost of property and equipment rose substantially from 1,645 million in 2018 to a peak of 2,520 million in 2021, then declined slightly to 2,381 million in 2022. This overall increase aligns with trends of asset acquisitions and growth, tempered by reduced additions or disposals in the latest period.

Accumulated Depreciation and Amortization

Accumulated depreciation and amortization steadily increased in absolute value from -1,058 million in 2018 to -1,571 million in 2021, followed by a slight decrease in depreciation to -1,519 million in 2022. The rise is consistent with aging assets and ongoing use, while the recent decrease could suggest asset retirements or changes in depreciation accounting.

Property and Equipment, Net

The net book value of property and equipment grew notably from 587 million in 2018 to 949 million in 2021 but declined to 862 million in 2022. The initial growth indicates asset accumulation outpacing depreciation, while the recent decrease may result from asset disposals, impairment, or reduced capital investment.

Overall, the data indicates a pattern of significant investment in buildings and computer equipment, tempered by reductions in certain other asset categories. The evolution of accumulated depreciation aligns with asset aging, with recent shifts suggesting possible strategic asset management activities. The net property and equipment values reflect these dynamics, with growth through 2021 followed by modest contraction in 2022.

Average age ratio

The average age ratio exhibits a fluctuating trend over the five-year period. It decreased from 65.55% in 2018 to 59.59% in 2019, indicating a relative reduction in the age of property, plant, and equipment. However, it increased again to 62.61% in 2020 and showed a gradual upward movement thereafter, reaching 64.89% by the end of 2022. This pattern suggests periodic asset renewal efforts that temporarily reduced the average age, followed by accumulation of older assets in subsequent years.

Estimated total useful life

The estimated total useful life of the assets has shown some variation but remained generally within a narrow range between 9 and 11 years. It increased to 11 years in 2019 from 9 years in 2018, then returned to 9 or 10 years in the subsequent years. This variability may be reflecting changes in asset composition or reassessments of useful life estimates rather than a consistent trend toward longer or shorter durations.

Estimated age, time elapsed since purchase

The estimated age of the assets has remained constant at 6 years throughout the entire period. This stability indicates that the average timing of asset acquisitions has not shifted significantly, implying a steady pace of asset replacement or acquisition that maintains the average asset age.

Estimated remaining life

The estimated remaining life fluctuates between 3 and 4 years across the periods, largely inversely related to the changes seen in total useful life. When total useful life increased to 11 years in 2019, the remaining life extended to 4 years, and otherwise remained around 3 years. This suggests that changes in useful life estimates directly impact the remaining life calculation, reflecting reassessed expectations for asset viability in the future.

Property and Equipment Cost

The cost of property and equipment showed an upward trend from 2018 to 2021, increasing from $1,645 million in 2018 to a peak of $2,520 million in 2021. However, in 2022, there was a decline to $2,381 million, indicating a reduction in capital investment or asset disposals during that period.

Accumulated Depreciation and Amortization

Accumulated depreciation and amortization consistently increased from $1,058 million in 2018 to $1,571 million in 2021, reflecting ongoing depreciation of existing assets and possibly additions to depreciable assets. In 2022, a decrease to $1,519 million was observed, which may suggest asset disposals or changes in depreciation methods.

Land

The land asset value exhibited minor fluctuations throughout the period, rising from $31 million in 2018 to a peak of $48 million in 2020, then declining to $40 million by 2022. This suggests limited acquisition or disposal activity related to land.

Average Age Ratio

The average age ratio, expressed as a percentage, showed variability over the period. It decreased from 65.55% in 2018 to 59.59% in 2019, indicating a relatively younger asset base possibly due to new acquisitions. Subsequently, it increased again to 64.89% by 2022, implying the asset base may be aging or fewer new assets were added relative to accumulated depreciation.

Summary of Trends

Overall, the data indicates that while significant investments in property and equipment occurred up to 2021, with rising costs and accumulated depreciation, there was a slight reversal in 2022. The decrease in both property and equipment cost and accumulated depreciation might indicate asset disposals or a slowdown in capital expenditures. The fluctuations in the average age ratio further suggest periods of renewal followed by phases of asset aging.

Property and Equipment, Cost

The cost of property and equipment displayed a notable increase from 2018 to 2021, rising from 1,645 million US dollars to a peak of 2,520 million US dollars. However, in 2022, there was a reduction to 2,381 million US dollars. This indicates that after a period of investment growth over the initial years, the company slightly reduced or optimized its capital expenditure on property and equipment towards the end of the period.

Land

Land values generally increased from 31 million US dollars in 2018 to 48 million in 2020. Following this peak, there was a gradual decrease to 40 million US dollars by 2022. This pattern suggests an initial acquisition or revaluation of land assets followed by disposals or a moderation in land asset growth.

Depreciation and Amortization Expense on Property and Equipment

The depreciation and amortization expenses rose steadily from 184 million US dollars in 2018 to 257 million US dollars in 2021, reflecting the growing asset base and associated usage or aging of assets. In 2022, this expense slightly declined to 251 million US dollars, consistent with the observed decrease in the cost of property and equipment assets.

Estimated Total Useful Life

The estimated useful life of the assets fluctuated marginally between 9 and 11 years over the periods. The useful life was highest in 2019 at 11 years but returned to around 9 or 10 years in following years. This suggests moderate changes in asset composition or asset life expectancy assessments.

The analysis of the property, plant, and equipment (PP&E) data over the five-year period reveals several notable trends related to accumulated depreciation, expense recognition, and asset aging.

Accumulated depreciation and amortization

The accumulated depreciation and amortization increased steadily from $1,058 million in 2018 to a peak of $1,571 million in 2021, before slightly declining to $1,519 million in 2022. This rise over the initial four years indicates consistent wear and consumption of the PP&E assets over time. The minor decline in 2022 suggests either a reduction in depreciable assets, asset disposals, or changes in depreciation methods or estimates.

Depreciation and amortization expense on property and equipment

The depreciation expense showed an upward trend from $184 million in 2018 to a high of $257 million in 2021, before a slight decrease to $251 million in 2022. The increase in expense aligns with the rising accumulated depreciation, reflecting consistent asset usage and expense recognition. The marginal decrease in the last year could be attributable to lower capital expenditures or changes in depreciation schedules.

Time elapsed since purchase

The time elapsed since purchase remained constant at 6 years throughout the period. This stability implies that the age profile of the assets did not significantly change, suggesting a stable asset base without significant recent additions or retirements impacting the average asset life.

Overall, the data reflects a mature asset base with steady depreciation patterns. The slight decreases in accumulated depreciation and expense in 2022 may warrant further investigation to understand the underlying factors, such as asset disposals, revaluations, or changes in accounting policies. The consistent time elapsed since purchase reinforces the view of a stable PP&E portfolio in terms of asset age.

Property and Equipment, Net

The net value of property and equipment exhibited some fluctuations over the given period. Beginning at 587 million USD in 2018, the value increased sharply to 900 million USD in 2019, followed by a slight decline to 887 million USD in 2020. It then rose again to 949 million USD in 2021 before decreasing to 862 million USD in 2022. Overall, the values peaked around 2021 but ended slightly lower than the peak year.

Land

The value of land showed a more modest and stable pattern in comparison to the total property and equipment net value. Starting at 31 million USD in 2018, it experienced gradual increases to 34 million USD in 2019 and 48 million USD in 2020, reaching its highest point in 2020. Subsequently, the land value declined to 46 million USD in 2021 and further to 40 million USD in 2022, reflecting a downward trend after 2020.

Depreciation and Amortization Expense on Property and Equipment

This expense category showed a consistent upward trend from 2018 to 2021, increasing from 184 million USD in 2018 to 257 million USD in 2021. In 2022, there was a slight decrease to 251 million USD. The growth over the first four years suggests increased usage or aging of property and equipment assets, with a minor reduction in the final year.

Estimated Remaining Life (in years)

The estimated remaining life of property and equipment fluctuated between 3 and 4 years over the years. It was 3 years in 2018, rose to 4 years in 2019, then dropped back to 3 years in 2020. In 2021 it again increased to 4 years before reverting to 3 years in 2022. This pattern indicates variability in asset aging and replacement cycles.