Arch Resources Inc (ARCH)
Inventory turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 2,639,100 | 2,651,640 | 1,821,730 | 1,653,680 | 2,143,120 |
| Inventory | US$ in thousands | 244,261 | 223,015 | 156,734 | 126,008 | 130,898 |
| Inventory turnover | 10.80 | 11.89 | 11.62 | 13.12 | 16.37 |
December 31, 2023 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $2,639,100K ÷ $244,261K
= 10.80
The inventory turnover ratio of Arch Resources Inc has been declining over the past five years, indicating a decreasing efficiency in managing inventory levels. The ratio decreased from 16.37 in 2019 to 10.80 in 2023. This downward trend suggests that the company is taking longer to sell its inventory or turning over its stock less frequently. This could result in higher holding costs, potential obsolescence, and reduced liquidity.
A lower inventory turnover ratio may also indicate overstocking or slowing demand for the company's products. Arch Resources Inc may need to reassess its inventory management practices to improve efficiency, streamline operations, and better align inventory levels with market demand. Additionally, the company should focus on optimizing production schedules and supply chain processes to enhance inventory turnover and overall profitability.
Peer comparison
Dec 31, 2023