The AES Corporation (AES)
Fixed asset turnover
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (ttm) | US$ in thousands | 12,278,000 | 12,284,000 | 12,429,000 | 12,514,000 | 12,668,000 | 12,760,000 | 12,953,000 | 13,004,000 | 12,617,000 | 12,327,000 | 11,736,000 | 11,358,000 | 11,141,000 | 10,931,000 | 10,440,000 | 9,957,000 | 9,660,000 | 9,531,000 | 9,611,000 | 9,877,000 |
| Property, plant and equipment | US$ in thousands | 33,166,000 | 32,354,000 | 30,732,000 | 31,906,000 | 29,958,000 | 27,535,000 | 26,077,000 | 24,213,000 | 23,039,000 | 21,597,000 | 20,753,000 | 20,453,000 | 19,906,000 | 22,788,000 | 22,582,000 | 22,498,000 | 22,826,000 | 22,287,000 | 22,836,000 | 22,570,000 |
| Fixed asset turnover | 0.37 | 0.38 | 0.40 | 0.39 | 0.42 | 0.46 | 0.50 | 0.54 | 0.55 | 0.57 | 0.57 | 0.56 | 0.56 | 0.48 | 0.46 | 0.44 | 0.42 | 0.43 | 0.42 | 0.44 |
December 31, 2024 calculation
Fixed asset turnover = Revenue (ttm) ÷ Property, plant and equipment
= $12,278,000K ÷ $33,166,000K
= 0.37
Fixed asset turnover measures how efficiently a company is utilizing its fixed assets to generate revenue. In the case of The AES Corporation, the trend in fixed asset turnover from March 31, 2020, to December 31, 2024, shows some fluctuations.
The fixed asset turnover ratio for AES started at 0.44 in March 31, 2020, and gradually declined to 0.37 by December 31, 2024. This indicates that the company's ability to generate sales from its fixed assets decreased over this period.
However, it is essential to consider the nature of AES's industry and its business strategy when interpreting this trend. A decreasing fixed asset turnover may suggest that AES is not efficiently utilizing its fixed assets to generate revenue. This could be due to factors such as underutilization of assets, inefficient operations, or a need for asset write-downs.
Further analysis and comparison with industry benchmarks would provide a clearer picture of how AES's fixed asset turnover compares with its peers and whether management actions are needed to improve asset utilization efficiency.