Property, Plant And Equipment

12 Months Ended

Dec. 31, 2023

Property, Plant And Equipment [Abstract]

‎

(7) Property, Plant, and Equipment:

Property, plant, and equipment, net at December 31, 2023 and 2022 are as follows:




	Estimated	December 31,		December 31,
($ in millions)	Useful Lives	2023		2022

Land	N/A	$	243	$	244
Buildings and leasehold improvements	40 years		1,221		1,212
General support	5 to 15 years		427		290
Central office/electronic circuit equipment	5 to 8 years		2,467		1,807
Poles	30 years		915		797
Cable, fiber, and wire	15 to 27 years		7,718		5,756
Conduit	50 years		1,416		1,404
Materials and supplies			594		546
Construction work in progress			1,323		1,130
Property, plant, and equipment			16,324		13,186
Less: Accumulated depreciation			(2,391)		(1,336)
Property, plant, and equipment, net		$	13,933	$	11,850

As of April 30, 2021, as a result of fresh start accounting, we have adjusted our property, plant, and equipment balance to fair value. See Note 4 for additional information. Property, plant, and equipment includes approximately $179 million and $121 million of fixed assets recognized under finance leases as of December 31, 2023 and 2022, respectively.

As of December 31, 2023, our materials and supplies were $594 million, as compared to $546 million as of December 31, 2022. This increase was primarily due to our fiber build plans and consumer premises equipment. Components of this include an increase in fiber, network electronics, and customer premises equipment.

During 2022, our materials and supplies increased by approximately $400 million, as compared to 2021. This increase was primarily due to our fiber build plans and consumer premises equipment.

In 2023, our capital expenditures were $3,211 million, which included a net decrease of $71 million due to changes in accounts payable and accrued liabilities, and vendor financing from December 31, 2022. As of December 31, 2023 there was $656 million in “accounts payable and accrued liabilities” and $255 million in vendor financing payables included in “other current liabilities” associated with capital expenditures. In 2023, we had capitalized interest of $83 million.

In 2023, we had asset sales and transactions of $63 million, including approximately $47 million in net proceeds related to certain wireless towers. Approximately $19 million of the proceeds related to wireless towers that qualified as sales, included in investing cash flows, and the remaining $28 million in proceeds related to wireless towers that were subject to sale-leaseback agreements and included in financing cash flows. After taking these sales and transactions into account, along with our capital expenditures, our net capital activity was $3,148 million as of December 31, 2023.

During 2022, we sold a property that was subject to leaseback, generating approximately $70 million in proceeds.

During 2021, we sold certain properties consisting of land and buildings for approximately $15 million in cash. The aggregate carrying value of the properties was approximately $14 million, resulting in a gain on the sale of $1 million, which, given our composite group method of accounting for depreciation, was recognized against “Accumulated Depreciation” in our consolidated balance sheet. We also sold certain properties subject to leaseback, generating $23 million in proceeds.

Depreciation expense is principally based on the composite group method. Depreciation expense was as follows:




	Successor						Predecessor
	For the year ended		For the year ended		For the eight months		For the four months
	December 31,		December 31,		ended December 31,		ended April 30,
($ in millions)	2023		2022		2021		2021

Depreciation expense	$	1,094	$	861	$	520	$	407

We adopted revised estimated remaining useful lives for certain plant assets as of October 1, 2023, as a result of an annual independent study of the estimated remaining useful lives of our plant assets, with an insignificant impact to depreciation expense.