Analysis of Property, Plant and Equipment
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- Balance Sheet: Assets
- Common-Size Income Statement
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Profitability Ratios
- Analysis of Long-term (Investment) Activity Ratios
- Enterprise Value (EV)
- Current Ratio since 2005
- Price to Operating Profit (P/OP) since 2005
- Price to Book Value (P/BV) since 2005
- Analysis of Revenues
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Property, Plant and Equipment Disclosure
RTX Corp., balance sheet: property, plant and equipment
US$ in millions
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 has shown a gradual decline over the period from 2020 to 2024, decreasing from 773 million US dollars to 695 million US dollars. This represents a steady reduction, indicating either disposals or revaluation adjustments over the years.
- Buildings and improvements
- Buildings and improvements have consistently increased each year, rising from 7067 million US dollars in 2020 to 8615 million US dollars in 2024. This upward trend suggests ongoing investments and enhancements to physical infrastructure.
- Machinery, tools, and equipment
- This category has exhibited steady growth across the five-year period, increasing from 15994 million US dollars in 2020 to 19738 million US dollars in 2024. The progression underscores continuous capital expenditure in operational equipment.
- Other, including assets under construction
- Values under this classification have consistently risen from 2512 million US dollars in 2020 to 3735 million US dollars in 2024. This trend likely reflects ongoing projects and investments in assets that are not yet completed or classified under other categories.
- Fixed assets, gross
- The total gross fixed assets have steadily increased from 26346 million US dollars in 2020 to 32783 million US dollars in 2024. This growth is driven by additions in buildings, machinery, and other asset categories, indicating an overall expansion in the asset base.
- Accumulated depreciation
- Accumulated depreciation has also increased in magnitude (becoming more negative) from -11384 million US dollars in 2020 to -16694 million US dollars in 2024. This consistent growth reflects the aging of assets and the associated expense recognition over time.
- Fixed assets, net
- Net fixed assets have experienced moderate growth, moving from 14962 million US dollars in 2020 to 16089 million US dollars in 2024. Despite significant depreciation, the net asset value has increased, which implies that asset additions and improvements have outpaced depreciation.
Asset Age Ratios (Summary)
RTX Corp., 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 exhibits a consistent upward trend over the five-year period, rising from 44.52% at the end of 2020 to 52.03% by the end of 2024. This indicates that the property, plant, and equipment are progressively aging, with more than half of the estimated useful life having been consumed by 2024.
- Estimated Total Useful Life
- The estimated total useful life has generally increased over the timeframe. Beginning at 14 years in 2020, it rose to 15 years for both 2021 and 2022, then further extended to 17 years in 2023, and finally reached 18 years in 2024. This suggests either improvements in equipment durability or revisions in asset life assumptions.
- Estimated Age (Time Elapsed Since Purchase)
- The estimated age steadily increases in alignment with the passing years, starting at 6 years in 2020 and reaching 9 years by 2023. It remains constant at 9 years in 2024, indicating no new asset purchases or disposals that would alter the asset age composition in the final year.
- Estimated Remaining Life
- The estimated remaining life stays relatively stable, holding at 8 years for most of the period from 2020 through 2023. In 2024, there is a slight increase to 9 years, which may be associated with the upward revision in the total useful life estimates. This suggests the company anticipates a longer period of service for its assets moving forward.
Average Age
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Accumulated depreciation | ||||||
| Fixed assets, 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 ÷ (Fixed assets, gross – Land)
= 100 × ÷ ( – ) =
- Accumulated Depreciation
- The accumulated depreciation has demonstrated a consistent upward trend over the five-year period, increasing from 11,384 million USD in 2020 to 16,694 million USD in 2024. This indicates ongoing consumption of the company's fixed assets and reflects the continuous allocation of asset costs over their useful lives.
- Fixed Assets, Gross
- Gross fixed assets have also shown a steady increase, rising from 26,346 million USD in 2020 to 32,783 million USD in 2024. This growth suggests ongoing investments in property, plant, and equipment, contributing to the expansion or modernization of the asset base.
- Land
- The value of land has experienced a slight decline during the period, decreasing from 773 million USD in 2020 to 695 million USD in 2024. This reduction may indicate disposals, revaluations, or adjustments reflecting market conditions or strategic asset management decisions related to land holdings.
- Average Age Ratio
- The average age ratio of assets exhibits a gradual increase, moving from 44.52% in 2020 to 52.03% in 2024. This trend suggests that the asset base is aging, with a higher proportion of the fixed assets approaching the end of their useful lives. It may imply a potential need for future capital expenditures to replace or upgrade aging equipment.
- Overall Analysis
- The data outlines a scenario of consistent asset accumulation alongside normal depreciation expenses. While the company appears committed to maintaining and growing its asset base, the rising average age ratio points to an increasingly mature asset portfolio. The slight decline in land value warrants further investigation to understand the underlying causes and their potential impact on asset management strategies.
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 = (Fixed assets, gross – Land) ÷ Depreciation expense related to fixed assets, net
= ( – ) ÷ =
- Gross Fixed Assets
- The gross value of fixed assets demonstrates a consistent upward trend over the five-year period. Starting from US$26,346 million at the end of 2020, it increased steadily each year, reaching US$32,783 million by the end of 2024. This represents an approximate total increase of 24.5%, indicating continuous investment or acquisition of fixed assets during this time frame.
- Land
- The recorded value of land shows a gradual decline over the period analyzed. Beginning at US$773 million in 2020, it declines slightly each year and falls to US$695 million by the end of 2024. This downward trend could reflect disposals, revaluations, or impairments of land assets.
- Depreciation Expense Related to Fixed Assets, Net
- Depreciation expense related to fixed assets exhibits minor fluctuations but remains relatively stable overall. It increased from US$1,767 million in 2020 to a peak of US$1,843 million in 2022, before experiencing a slight decrease to US$1,800 million by 2023 and staying constant through 2024. This pattern suggests that depreciation charges are managed in line with asset base changes and useful life estimates.
- Estimated Total Useful Life
- The estimated total useful life of the fixed assets lengthened over the period. It started at 14 years in 2020, then increased to 15 years for the 2021 and 2022 periods, before rising further to 17 years in 2023 and 18 years by 2024. This extension in asset useful life estimates could influence the depreciation expense and reflect adjustments based on asset condition or re-assessments.
- Overall Insights
- The overall data indicates that the company is actively expanding its fixed asset base while simultaneously managing asset longevity through increasing estimated useful life. The stable depreciation expense despite growth in gross fixed assets suggests effective asset management strategies or changes in depreciation policies. The decline in land value contrasts with the broader fixed asset growth, signaling specific alterations related to land holdings.
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 related to fixed assets, net
= ÷ =
- Accumulated Depreciation
- Accumulated depreciation exhibits a consistent upward trend over the five-year period, increasing from 11,384 million USD at the end of 2020 to 16,694 million USD by the end of 2024. This steady growth indicates ongoing wear and usage of property, plant, and equipment assets, reflecting typical depreciation accumulation as the assets age.
- Depreciation Expense Related to Fixed Assets, Net
- The annual depreciation expense shows a moderate increase initially, rising from 1,767 million USD in 2020 to a peak of 1,843 million USD in 2022. However, this expense slightly decreases thereafter, stabilizing at 1,800 million USD in both 2023 and 2024. This pattern suggests that although assets continue to depreciate, the annual charge to expense has either reached a plateau or management has adjusted depreciation methods or asset base accordingly.
- Time Elapsed Since Purchase
- The average age of the assets rises progressively from 6 years in 2020 to 9 years in 2023, remaining steady at 9 years in 2024. This indicates that the company's property, plant, and equipment are aging, with possibly fewer recent acquisitions or lower asset turnover in the last year reported.
- Overall Insights
- The data reflects a typical asset aging and usage cycle with accumulated depreciation growing steadily, a stable depreciation expense in recent years, and an increasing asset age. The leveling off of the depreciation expense alongside the constant asset age in the final year may imply limited new investment in property, plant, and equipment or a shift in asset management strategy.
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 = (Fixed assets, net – Land) ÷ Depreciation expense related to fixed assets, net
= ( – ) ÷ =
- Fixed Assets, Net
- The net value of fixed assets demonstrates a generally upward trend over the five-year period. Starting from $14,962 million at the end of 2020, the figure increased slightly to $14,972 million in 2021 and continued to grow more significantly to $15,170 million in 2022. The upward momentum persisted with values reaching $15,748 million by the end of 2023 and further to $16,089 million in 2024. This consistent increase suggests ongoing investments or additions outweighing depreciation and disposals.
- Land
- The value attributed to land has exhibited a declining trend throughout the period under review. From $773 million in 2020, the land value decreased steadily to $765 million in 2021, further to $744 million in 2022, $743 million in 2023, and dropped more sharply to $695 million in 2024. This decline may indicate disposals of land holdings or revaluation adjustments reducing the recorded value.
- Depreciation Expense Related to Fixed Assets, Net
- The depreciation expense has shown relative stability with a slight initial increase followed by a marginal decrease. It rose from $1,767 million in 2020 to $1,828 million in 2021 and peaked at $1,843 million in 2022. Subsequently, it declined to $1,800 million in both 2023 and 2024. This pattern may reflect changes in depreciation methods, asset additions with different useful lives, or assets reaching the end of their depreciation schedules.
- Estimated Remaining Life
- The estimated remaining useful life of fixed assets remained constant at 8 years from 2020 to 2023, then extended slightly to 9 years in 2024. This increment could imply the acquisition of assets with longer service lives or re-assessments extending the expected usage period of existing assets, potentially impacting future depreciation charges.