PROPERTY, PLANT AND EQUIPMENT

9 Months Ended

Sep. 26, 2021

Property, Plant and Equipment [Abstract]

PROPERTY, PLANT AND EQUIPMENTProperty, plant and equipment (“PP&E”), net consisted of the following:


	September 26, 2021		December 27, 2020
	(In thousands)
Land	$	258,701	$	255,171
Buildings	2,075,174		1,983,823
Machinery and equipment	3,444,602		3,230,199
Autos and trucks	74,524		73,647
Finance leases	2,182		2,182
Construction-in-progress	213,488		199,161
PP&E, gross	6,068,671		5,744,183
Accumulated depreciation	(3,220,202)		(3,086,692)
PP&E, net	$	2,848,469	$	2,657,491

The Company recognized depreciation expense of $86.3 million and $77.7 million during the three months ended September 26, 2021 and September 27, 2020, respectively. The Company recognized depreciation expense of $256.9 million and $231.6 million during the nine months ended September 26, 2021 and September 27, 2020, respectively.

During the nine months ended September 26, 2021, Pilgrim’s spent $280.8 million on capital projects and transferred $324.1 million of completed projects from construction-in-progress to depreciable assets. Capital expenditures were primarily incurred during the nine months ended September 26, 2021 to improve efficiencies and reduce costs. During the nine months ended September 27, 2020, the Company spent $242.6 million on capital projects and transferred $190.1 million of completed projects from construction-in-progress to depreciable assets.

During the three and nine months ended September 26, 2021, the Company sold certain PP&E for $1.5 million and $22.9 million, respectively, in cash and recognized a net loss of $1.5 million and a net gain of $3.6 million on these sales, respectively. PP&E sold during the nine months ended September 26, 2021 consisted of a broiler farm in Mexico, two processing plants within the U.K. and other miscellaneous equipment. During the three and nine months ended September 27, 2020, the Company sold miscellaneous equipment for cash of $11.8 million and $21.7 million, respectively, and recognized net gains on these sales of $6.4 million and $8.0 million, respectively.

The Company has closed or idled various facilities in the U.S. and in the U.K. The Board of Directors has not determined if it would be in the best interest of the Company to divest any of these idled assets. Management is therefore not certain that it can or will divest any of these assets within one year, is not actively marketing these assets and, accordingly, has not classified them as assets held for sale. The Company continues to depreciate these assets. As of September 26, 2021, the carrying amounts of these idled assets totaled $41.8 million based on depreciable value of $205.8 million and accumulated depreciation of $164.0 million.

As of September 26, 2021, the Company assessed if events or changes in circumstances indicated that the asset group-level carrying amounts of its property, plant and equipment held for use might not be recoverable. There were no indicators present that required the Company to test the recoverability of the asset group-level carrying amounts of its property, plant and equipment held for use at that date.