Avanos Medical Inc (AVNS)

Inventory turnover

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cost of revenue	US$ in thousands	306,500	293,600	370,000	380,300	341,500
Inventory	US$ in thousands	138,800	163,200	190,300	150,300	168,900
Inventory turnover		2.21	1.80	1.94	2.53	2.02

December 31, 2024 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $306,500K ÷ $138,800K
= 2.21

Inventory turnover is an essential financial ratio that indicates how efficiently a company manages its inventory. Looking at the data provided for Avanos Medical Inc, we observe a fluctuating trend in inventory turnover over the past five years.

In December 2020, the inventory turnover stood at 2.02, reflecting that the company's inventory was turned over approximately 2.02 times during that year. The following year, the inventory turnover improved to 2.53, indicating a more efficient management of inventory.

However, in the subsequent years, there was a decline in inventory turnover. By December 2022, the ratio dropped to 1.94, suggesting a slowdown in the rate at which inventory was being sold and replenished. This trend continued in December 2023, with the inventory turnover decreasing further to 1.80.

Nevertheless, there was a positive change in December 2024, with the inventory turnover increasing to 2.21. This uptick could be a result of improved inventory management practices or increased sales efficiency during that period.

Overall, Avanos Medical Inc's inventory turnover has shown fluctuations over the past five years, indicating varying levels of efficiency in managing its inventory levels. It is essential for the company to analyze the factors influencing these fluctuations to optimize inventory turnover and enhance operational performance.