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Global Payments Inc  (NYSE:GPN) Property, Plant and Equipment: $538 Mil (As of Jun. 2017)

Global Payments Inc's quarterly net PPE increased from Nov. 2016 ($521 Mil) to Mar. 20 ($552 Mil) but then declined from Mar. 20 ($552 Mil) to Jun. 2017 ($538 Mil).

Global Payments Inc's annual net PPE increased from May. 2013 ($348 Mil) to May. 2014 ($370 Mil) and increased from May. 2014 ($370 Mil) to May. 2015 ($374 Mil).


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

* Premium members only.

Global Payments Inc Annual Data

May06 May07 May08 May09 May10 May11 May12 May13 May14 May15
Property, Plant and Equipment Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 256.30 305.85 348.06 369.75 374.14

Global Payments Inc Quarterly Data

Aug12 Nov12 Feb13 May13 Aug13 Nov13 Feb14 May14 Aug14 Nov14 Feb15 May15 Aug15 Nov15 Feb16 May16 Aug16 Nov16 Mar17 Jun17
Property, Plant and Equipment Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 493.68 512.08 520.71 551.95 537.88

Calculation

Property, Plant and Equipment (PPE) are the fixed assets of the companyFixed assets are also known as non-current assets.

Property, plant, and equipment includes assets that will - in the normal course of business - neither be used up in the next year nor will become a part of any product sold to customers.

Some of the most common parts of property, plant, and equipment are:


Land
Buildings (and leasehold improvements)
Transportation equipment
Manufacturing equipment
Office equipment
Office furniture

Companies with lots of property, plant, and equipment often have special categories. For example, railroad property includes:


Track
Ties
Ballast
Bridges
Tunnels
Signals
Locomotives
Freight Cars

There is often a note in the financial statements - found in a company's 10-K - that will explain the different categories of property a company owns.

The market value of property, plant, and equipment can differ tremendously from the book value of property, plant, and equipment.

For example, when Berkshire Hathaway liquidated its textile mills, it had to pay the buyers of the company's manufacturing equipment to haul the equipment away. That property, plant, and equipment was literally worth less than zero. On the other hand, some companies own thousands of acres of land.

All property, plant, and equipment other than land is depreciated. Land is never depreciated. However, land is not marked up to market value either. Under Generally Accepted Accounting Principles (GAAP), land is shown on the balance sheet at cost.

The property, plant, and equipment line shown on the balance sheet is usually net property, plant, and equipment. This means it is the cost of the property, plant, and equipment less accumulated depreciation.


Explanation

A company with durable competitive advantage doesn't need to constantly upgrade its equipment to stay competitive. The company replaces when it wears out. On the other hand, a company without any advantages must replace to keep pace.

Difference between a company with a moat and one without is that the company with the competitive advantage finances new equipment through internal cash flows, whereas the no advantage company requires debt to finance.

Producing a consistent product that doesn't change equates to consistent profits. There is no need to upgrade plants which frees up cash for other ventures. Think Coca Cola, Johnson & Johnson etc.


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