Alcoa Corp (AA)
Fixed asset turnover
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (ttm) | US$ in thousands | 10,494,000 | 10,518,000 | 10,798,000 | 11,717,000 | 12,326,000 | 12,863,000 | 13,111,000 | 12,351,000 | 11,954,000 | 11,167,000 | 10,433,000 | 9,693,000 | 9,175,000 | 9,219,000 | 9,428,000 | 9,990,000 | 10,327,000 | 11,235,000 | 12,076,000 | 12,977,000 |
| Property, plant and equipment | US$ in thousands | 6,785,000 | 6,532,000 | 6,445,000 | 6,426,000 | 6,493,000 | 6,254,000 | 6,457,000 | 6,824,000 | 6,623,000 | 6,679,000 | 6,976,000 | 6,930,000 | 7,190,000 | 7,250,000 | 7,289,000 | 7,160,000 | 7,916,000 | 7,929,000 | 8,273,000 | 8,328,000 |
| Fixed asset turnover | 1.55 | 1.61 | 1.68 | 1.82 | 1.90 | 2.06 | 2.03 | 1.81 | 1.80 | 1.67 | 1.50 | 1.40 | 1.28 | 1.27 | 1.29 | 1.40 | 1.30 | 1.42 | 1.46 | 1.56 |
December 31, 2023 calculation
Fixed asset turnover = Revenue (ttm) ÷ Property, plant and equipment
= $10,494,000K ÷ $6,785,000K
= 1.55
The fixed asset turnover ratio is a measure of how efficiently a company is utilizing its fixed assets to generate revenue. A higher fixed asset turnover ratio indicates that the company is generating more revenue for each dollar invested in fixed assets.
Based on the data provided for Alcoa Corp over recent quarters, we can observe a declining trend in the fixed asset turnover ratio. The ratio has decreased from 2.10 in Q3 2022 to 1.56 in Q4 2023. This decline suggests that the company may be less efficient in using its fixed assets to generate revenue.
A ratio below 1 indicates that the company is not generating enough revenue relative to its investment in fixed assets, which could signal inefficiencies in asset utilization. Conversely, a ratio above 1 signifies that the company is generating more revenue than the value of its fixed assets, which is generally considered favorable.
In the case of Alcoa Corp, the gradual decrease in the fixed asset turnover ratio over the quarters indicates a potential deterioration in the efficiency of using fixed assets to generate sales. This trend may warrant further investigation into the company's operational performance and potential areas for improvement in asset utilization.
Peer comparison
Dec 31, 2023