Analysis of Property, Plant and Equipment
Property, Plant and Equipment Disclosure
Kellanova, balance sheet: property, plant and equipment
US$ in millions
Based on: 10-K (reporting date: 2023-12-30), 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: 2019-12-28).
Between 2019 and 2022, gross property assets exhibited a consistent upward trajectory, followed by a significant contraction in 2023. The total gross value rose from 9,051 million USD in 2019 to a peak of 9,881 million USD in 2022, before declining to 7,545 million USD in 2023.
- Gross Asset Composition
- Machinery and equipment represent the largest component of the asset base, growing from 5,852 million USD in 2019 to a peak of 6,339 million USD in 2022, before a sharp decline to 4,690 million USD in 2023. Similarly, buildings increased from 2,021 million USD in 2019 to 2,274 million USD in 2022, then decreased to 1,722 million USD in 2023.
- Secondary Asset Trends
- Land holdings remained relatively stable over the five-year period, fluctuating slightly between a high of 123 million USD in 2021 and a low of 107 million USD in 2023. Capitalized software reached a peak of 594 million USD in 2021 before trending downward to 435 million USD by 2023. Construction in progress showed minimal variance, maintaining a range between 566 million USD and 660 million USD.
- Depreciation and Net Book Value
- Accumulated depreciation increased steadily from 5,439 million USD in 2019 to 6,092 million USD in 2022. A substantial reduction in accumulated depreciation occurred in 2023, falling to 4,333 million USD, which suggests the divestiture or write-off of significant portions of the asset base. This concurrent drop in both gross assets and accumulated depreciation resulted in a net property value of 3,212 million USD in 2023, representing a more moderate decline compared to the gross asset contraction.
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Asset Age Ratios (Summary)
Kellanova, asset age ratios
| Dec 30, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 28, 2019 | ||
|---|---|---|---|---|---|---|
| Average age ratio | 58.25% | 62.34% | 61.94% | 61.77% | 60.87% |
Based on: 10-K (reporting date: 2023-12-30), 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: 2019-12-28).
The analysis of the average asset age ratio reveals a period of steady increase followed by a notable correction in the most recent fiscal year.
- Asset Aging Phase (2019–2022)
- Between December 28, 2019, and December 31, 2022, the average age ratio exhibited a consistent upward trajectory, rising from 60.87% to a peak of 62.34%. This trend suggests a period during which existing property, plant, and equipment were aging relative to their estimated useful lives, with capital expenditures failing to outpace the rate of depreciation.
- Asset Rejuvenation Phase (2022–2023)
- A significant reversal is observed between December 31, 2022, and December 30, 2023, as the ratio declined to 58.25%. This decrease of 4.09 percentage points indicates a rejuvenation of the asset base, likely driven by substantial investments in new fixed assets or the strategic disposal of older, heavily depreciated assets.
The longitudinal trend demonstrates that after a three-year period of incremental aging, the asset profile shifted toward a younger average age by the end of 2023, potentially enhancing operational efficiency through modernized infrastructure.
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Average Age
Based on: 10-K (reporting date: 2023-12-30), 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: 2019-12-28).
2023 Calculations
1 Average age = 100 × Accumulated depreciation ÷ (Property, gross – Land)
= 100 × 4,333 ÷ (7,545 – 107) = 58.25%
The analysis of property, plant, and equipment from 2019 to 2023 reveals a period of gradual asset expansion and aging followed by a significant contraction in the final year. Between 2019 and 2022, there was a consistent increase in both gross property values and accumulated depreciation, indicating a maturing asset base. However, the 2023 fiscal year shows a sharp decline in these figures, suggesting a major divestiture or corporate restructuring of fixed assets.
- Gross Asset and Depreciation Trends
- Gross property values rose steadily from 9,051 million USD in 2019 to a peak of 9,881 million USD in 2022, before dropping substantially to 7,545 million USD in 2023. This decline is mirrored by accumulated depreciation, which climbed from 5,439 million USD in 2019 to 6,092 million USD in 2022, and then fell to 4,333 million USD in 2023. The concurrent decrease in both metrics indicates that a significant portion of the assets removed from the balance sheet were those with high accumulated depreciation.
- Average Age Ratio Analysis
- The average age ratio exhibited a gradual upward trend from 60.87% in 2019 to 62.34% in 2022, signifying that the asset base was aging faster than it was being replenished. In 2023, this ratio reversed to 58.25%. This reduction suggests that the disposal of older assets effectively lowered the average age of the remaining property, plant, and equipment portfolio.
- Land Value Consistency
- Unlike depreciable assets, land holdings remained relatively stable throughout the analyzed period. Values fluctuated within a narrow range, starting at 116 million USD in 2019, peaking at 123 million USD in 2021, and ending at 107 million USD in 2023. This stability indicates that the recent volatility in the total asset base was driven by equipment and buildings rather than real estate holdings.
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