Automatic Data Processing Inc (ADP)

Fixed asset turnover

		Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021	Jun 30, 2020
Revenue	US$ in thousands	19,202,600	18,012,200	16,498,300	15,005,400	14,589,800
Property, plant and equipment	US$ in thousands	685,600	681,400	652,600	684,500	703,900
Fixed asset turnover		28.01	26.43	25.28	21.92	20.73

June 30, 2024 calculation

Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $19,202,600K ÷ $685,600K
= 28.01

Fixed asset turnover measures how efficiently a company generates revenue from its fixed assets. It indicates the company's ability to utilize its fixed assets to generate sales.

Automatic Data Processing Inc's fixed asset turnover has shown a consistent upward trend over the past five years, increasing from 20.73 in 2020 to 28.01 in 2024. This indicates that the company has been more efficient in generating sales from its fixed assets.

A higher fixed asset turnover ratio suggests that the company is utilizing its fixed assets more effectively to generate revenue, which can be a positive sign of operational efficiency and asset productivity.

Overall, Automatic Data Processing Inc's increasing fixed asset turnover ratio indicates improved efficiency in utilizing its fixed assets to generate sales, reflecting positively on the company's operational performance.