Arrowhead Pharmaceuticals Inc (ARWR)

Fixed asset turnover

		Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020	Sep 30, 2019
Revenue	US$ in thousands	222,409	243,231	138,287	87,992	168,796
Property, plant and equipment	US$ in thousands	290,262	110,297	48,675	30,881	23,215
Fixed asset turnover		0.77	2.21	2.84	2.85	7.27

September 30, 2023 calculation

Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $222,409K ÷ $290,262K
= 0.77

The fixed asset turnover ratio measures the efficiency with which a company utilizes its fixed assets to generate sales. A higher ratio indicates better utilization of fixed assets.

Arrowhead Pharmaceuticals Inc.'s fixed asset turnover has declined from 7.27 in 2019 to 0.83 in 2023. This signifies a substantial decrease in the company's ability to generate sales using its fixed assets.

The significant drop in the ratio suggests a potential underutilization or impaired efficiency of Arrowhead Pharmaceuticals Inc.'s fixed assets in generating sales over the years. It is important for the company to investigate the reasons behind this decline and consider strategies to improve the utilization of its fixed assets to enhance operational efficiency and productivity.