Procter & Gamble Co. (NYSE:PG)

Machinery and Equipment

The value of machinery and equipment steadily increased over the observed period, starting from $32,263 million in 2019 and rising to $37,508 million by 2024. This indicates a consistent investment in production assets, with notable increments each year except for a slight dip in 2022 compared to 2021.

Buildings

Building values showed a mild upward trend, increasing from $7,746 million in 2019 to $8,534 million in 2024. The year-over-year changes are relatively small, suggesting moderate expansion or maintenance of existing structures rather than significant new construction.

Construction in Progress

Construction in progress exhibited fluctuations but generally increased from $2,579 million in 2019 to $3,126 million in 2024. The rise in the last two years may indicate ongoing projects and upcoming capital expenditures, reflecting forward-looking investments to expand capacity or upgrade facilities.

Land

Land values remained relatively stable with minor variation across the period, starting at $805 million in 2019 and reaching $895 million in 2024. The modest growth suggests occasional acquisitions or revaluations but no major changes.

Property, Plant and Equipment (Gross)

The gross property, plant, and equipment figure followed an upward trend from $43,393 million in 2019 to $50,063 million in 2024. This growth reflects the aggregate increases in machinery, buildings, construction in progress, and land, pointing to continuous capital asset expansion.

Accumulated Depreciation

Accumulated depreciation increased steadily in magnitude from -$22,122 million in 2019 to -$27,911 million in 2024. This increase is in line with ongoing asset aging and usage over time, reflecting systematic expense recognition of capital assets' cost.

Property, Plant and Equipment (Net)

The net property, plant, and equipment value showed a fluctuating but overall moderate increase, from $21,271 million in 2019 to $22,152 million in 2024. Despite a dip in 2020 and 2022, the net figure's recovery and growth suggest that new acquisitions and investments generally outpaced depreciation effects, maintaining and slightly growing the company's net asset base.

The average age ratio of property, plant, and equipment exhibits a consistent upward trend over the six-year period from June 30, 2019, to June 30, 2024. Starting at 51.94% in 2019, it progressively increases each year, reaching 56.77% by mid-2024.

This steady increase in the average age ratio suggests that the company's fixed assets are aging over time without proportional replacement or additions of new assets to lower the average age. A rising average age ratio could indicate either a strategic emphasis on maximizing the use of existing assets or potential underinvestment in updating the property, plant, and equipment.

As the ratio surpasses the midpoint range over these years, there may be implications for maintenance costs, asset efficiency, and potential future capital expenditures required to modernize the asset base. Continued monitoring of this trend is advisable to assess asset condition and plan for necessary reinvestment to sustain operational effectiveness.

Property, Plant, and Equipment, Gross

The gross value of property, plant, and equipment demonstrates a consistent upward trajectory over the six-year period. Starting at 43,393 million US dollars in mid-2019, it increased steadily to reach 50,063 million US dollars by mid-2024. This reflects ongoing investments in fixed assets, indicative of capacity expansion or modernization efforts.

Accumulated Depreciation

Accumulated depreciation also shows a clear increasing trend, rising from 22,122 million US dollars in 2019 to 27,911 million in 2024. The growth in accumulated depreciation is consistent year-over-year, reflecting the aging of assets and the systematic allocation of depreciation expense. The increase accompanies the growth in gross property, plant, and equipment but at a somewhat slower incremental pace.

Land

The value of land holdings experiences minor fluctuations throughout the period but remains relatively stable overall. It starts at 805 million US dollars in 2019, dips slightly in the succeeding years, and then rebounds to 895 million US dollars by 2024. This suggests selective land acquisitions or disposals but no major shifts in land asset size.

Average Age Ratio

The average age ratio, which likely represents the proportion of accumulated depreciation to the gross property, plant, and equipment, shows a gradual increase from 51.94% in 2019 to 56.77% in 2024. This rising percentage indicates that the overall asset base is aging, with a larger share of assets being depreciated over time. It suggests that while new investments are being made, older assets constitute a significant portion of the capital base.

Overall Insights

The financial data reveals a business actively maintaining and growing its fixed asset base, evidenced by steady growth in gross property, plant, and equipment values. The corresponding increase in accumulated depreciation and the rising average age ratio indicate that the asset portfolio is maturing, requiring sustained capital expenditure to replace or upgrade aging infrastructure. The steady land values imply a relatively stable land asset base, with minor adjustments rather than significant expansions or disposals.