Avantor Inc (AVTR)
Fixed asset turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 6,783,600 | 6,967,200 | 7,512,400 | 7,386,100 | 6,393,600 |
| Property, plant and equipment | US$ in thousands | 708,100 | 737,500 | 727,000 | 705,500 | 549,900 |
| Fixed asset turnover | 9.58 | 9.45 | 10.33 | 10.47 | 11.63 |
December 31, 2024 calculation
Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $6,783,600K ÷ $708,100K
= 9.58
The fixed asset turnover of Avantor Inc has shown a declining trend over the past few years. The ratio declined from 11.63 in December 2020 to 9.58 in December 2024. This indicates that Avantor Inc's ability to generate revenue from its fixed assets has decreased over this period.
A high fixed asset turnover ratio is generally considered favorable as it suggests that the company is efficiently using its fixed assets to generate sales. On the contrary, a decreasing fixed asset turnover ratio may imply inefficiencies in asset utilization or a drop in sales relative to its fixed asset base.
Avantor Inc should closely monitor and analyze the reasons behind this declining trend in fixed asset turnover to identify and address any underlying operational or strategic issues that may be impacting its asset utilization efficiency. It might be beneficial for the company to explore opportunities for optimizing asset allocation and improving operational processes to enhance its fixed asset turnover ratio in the future.
Peer comparison
Dec 31, 2024