D.3. Property, plant and equipment
Property, plant and equipment (including assets held under finance leases) comprise:
| (€ million) | Land | Buildings |
Machinery and |
Fixtures, fittings & other |
Property, plant & |
Total | ||||||||||||||||||
| Gross value at January 1, 2015 | 372 | 6,915 | 9,419 | 2,215 | 1,959 | 20,880 | ||||||||||||||||||
| Changes in scope of consolidation | (4) | 1 | (8) | 1 | (22) | (32) | ||||||||||||||||||
| Acquisitions and other increases | - | 11 | 76 | 59 | 1,172 | 1,318 | ||||||||||||||||||
| Disposals and other decreases | (3) | (4) | (17) | (126) | (23) | (173) | ||||||||||||||||||
| Currency translation differences | 5 | 144 | 122 | 24 | 25 | 320 | ||||||||||||||||||
| Transfers(a) | (1) | 269 | 463 | 228 | (1,083) | (124) | ||||||||||||||||||
| Reclassification of the Animal Health business(b) | (33) | (604) | (313) | (54) | (76) | (1,080) | ||||||||||||||||||
| Gross value at December 31, 2015 | 336 | 6,732 | 9,742 | 2,347 | 1,952 | 21,109 | ||||||||||||||||||
| Acquisitions and other increases | - | 9 | 48 | 51 | 1,232 | 1,340 | ||||||||||||||||||
| Disposals and other decreases | (10) | (111) | (350) | (104) | (37) | (612) | ||||||||||||||||||
| Currency translation differences | 1 | 81 | 36 | (1) | 15 | 132 | ||||||||||||||||||
| Transfers(a) | - | 247 | 558 | 128 | (1,025) | (92) | ||||||||||||||||||
| Gross value at December 31, 2016 | 327 | 6,958 | 10,034 | 2,421 | 2,137 | 21,877 | ||||||||||||||||||
| Changes in scope of consolidation | 22 | 23 | 11 | 6 | 7 | 69 | ||||||||||||||||||
| Acquisitions and other increases | - | 10 | 63 | 54 | 1,267 | 1,394 | ||||||||||||||||||
| Disposals and other decreases | (10) | (124) | (261) | (125) | (111) | (631) | ||||||||||||||||||
| Currency translation differences | (21) | (326) | (278) | (75) | (84) | (784) | ||||||||||||||||||
| Transfers(a) | - | 227 | 576 | 169 | (919) | 53 | ||||||||||||||||||
| Gross value at December 31, 2017 | 318 | 6,768 | 10,145 | 2,450 | 2,297 | 21,978 | ||||||||||||||||||
| Accumulated depreciation & impairment at January 1, 2015 | (17) | (2,979) | (5,780) | (1,549) | (159) | (10,484) | ||||||||||||||||||
| Changes in scope of consolidation | 6 | 5 | 12 | - | 22 | 45 | ||||||||||||||||||
| Depreciation expense | - | (376) | (607) | (208) | - | (1,191) | ||||||||||||||||||
| Impairment losses, net of reversals | - | (38) | (42) | (11) | (41) | (132) | ||||||||||||||||||
| Disposals and other decreases | - | 3 | 15 | 122 | 13 | 153 | ||||||||||||||||||
| Currency translation differences | - | (33) | (49) | (17) | - | (99) | ||||||||||||||||||
| Transfers(a) | - | 34 | 90 | (4) | (1) | 119 | ||||||||||||||||||
| Reclassification of the Animal Health business(b) | - | 252 | 145 | 26 | - | 423 | ||||||||||||||||||
| Accumulated depreciation & impairment at December 31, 2015 | (11) | (3,132) | (6,216) | (1,641) | (166) | (11,166) | ||||||||||||||||||
| Depreciation expense | - | (356) | (595) | (190) | - | (1,141) | ||||||||||||||||||
| Impairment losses, net of reversals | (3) | (31) | (17) | (30) | (78) | (159) | ||||||||||||||||||
| Disposals and other decreases | 3 | 107 | 348 | 100 | 33 | 591 | ||||||||||||||||||
| Currency translation differences | - | (37) | (16) | (2) | (2) | (57) | ||||||||||||||||||
| Transfers(a) | 4 | 22 | 16 | 6 | 26 | 74 | ||||||||||||||||||
| Accumulated depreciation & impairment at December 31, 2016 | (7) | (3,427) | (6,480) | (1,757) | (187) | (11,858) | ||||||||||||||||||
| Depreciation expense | - | (329) | (595) | (197) | - | (1,121) | ||||||||||||||||||
| Impairment losses, net of reversals | (11) | (45) | (177) | (6) | (15) | (254) | ||||||||||||||||||
| Disposals and other decreases | - | 94 | 239 | 117 | 107 | 557 | ||||||||||||||||||
| Currency translation differences | 1 | 140 | 147 | 53 | 2 | 343 | ||||||||||||||||||
| Transfers(a) | (3) | (45) | (19) | (14) | 15 | (66) | ||||||||||||||||||
| Accumulated depreciation & impairment at December 31, 2017 | (20) | (3,612) | (6,885) | (1,804) | (78) | (12,399) | ||||||||||||||||||
| Carrying amount at December 31, 2015 | 325 | 3,600 | 3,526 | 706 | 1,786 | 9,943 | ||||||||||||||||||
| Carrying amount at December 31, 2016 | 320 | 3,531 | 3,554 | 664 | 1,950 | 10,019 | ||||||||||||||||||
| Carrying amount at December 31, 2017 | 298 | 3,156 | 3,260 | 646 | 2,219 | 9,579 | ||||||||||||||||||
| (a) |
This line also includes the effect of the reclassification of assets to Assets held for sale or exchange. |
| (b) |
This line comprises the property, plant and equipment of the Animal Health business, reclassified to Assets held for sale or exchange as of December 31, 2015 in accordance with IFRS 5 (see Notes D.1. and D.36.). |
Acquisitions during 2017 amounted to €1,394 million. Of this amount, €1,005 million related to the Pharmaceuticals segment, primarily investments in industrial facilities (€741 million in 2017, compared with €761 million in 2016 and €594 million in 2015 excluding Genzyme in each case) and in constructing and equipping research sites (€138 million in 2017, versus €164 million in 2016 and €82 million in 2015). Genzyme made a zero contribution to Pharmaceuticals segment acquisitions in 2017 (versus €8 million in 2016 and €80 million in 2015). The Vaccines segment made €379 million of acquisitions in 2017 (versus €271 million in 2016 and €260 million in 2015). The Consumer Healthcare segment accounted for €10 million of investments. Acquisitions of property, plant and equipment during the year included €20 million of capitalized interest costs (versus €17 million in 2016 and €15 million in 2015).
Firm orders of property, plant and equipment were €508 million as of December 31, 2017 (€545 million as of December 31, 2016 and €436 million as of December 31, 2015). Property, plant and equipment pledged as security for liabilities amounted to €128 million as of December 31, 2017 (versus €241 million as of December 31, 2016 and €249 million as of December 31, 2015).
During 2017 impairment tests of property, plant and equipment conducted using the method described in Note B.6. resulted in the recognition of net impairment losses of €254 million (including €87 million on property, plant and equipment associated with the dengue vaccine; see Note D.26.). In 2016, net impairment losses were €159 million. In 2015, net impairment losses totaled €132 million, primarily in the Pharmaceuticals segment.
The table below shows amounts for items of property, plant and equipment held under finance leases:
| (€ million) | 2017 | 2016 | 2015 | |||||||||
| Land | 4 | 3 | 3 | |||||||||
| Buildings | 102 | 102 | 101 | |||||||||
| Other | 9 | 8 | 8 | |||||||||
| Total gross value | 115 | 113 | 112 | |||||||||
| Accumulated depreciation and impairment | (87) | (79) | (69) | |||||||||
| Carrying amount | 28 | 34 | 43 | |||||||||
Future minimum lease payments due under finance leases as of December 31, 2017 were €39 million (versus €66 million as of December 31, 2016 and €83 million as of December 31, 2015), including €7 million of interest (versus €13 million as of December 31, 2016 and €15 million as of December 31, 2015).
As of December 31, 2017, the payment schedule is as follows:
| Payments due by period | ||||||||||||||||||||
| (€ million) | Total |
Less than 1 year |
1 to 3 years | 3 to 5 years |
More than 5 years |
|||||||||||||||
| Finance lease obligations | ||||||||||||||||||||
|
∎ principal |
32 | 11 | 6 | 6 | 9 | |||||||||||||||
|
∎ interest |
7 | 2 | 2 | 2 | 1 | |||||||||||||||
| Total | 39 | 13 | 8 | 8 | 10 | |||||||||||||||