Avantor Inc (AVTR)

Inventory turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cost of revenue	US$ in thousands	4,603,400	4,909,600	4,883,400	4,313,100	4,119,600
Inventory	US$ in thousands	828,100	913,500	872,000	739,600	711,200
Inventory turnover		5.56	5.37	5.60	5.83	5.79

December 31, 2023 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $4,603,400K ÷ $828,100K
= 5.56

Avantor Inc's inventory turnover has shown a slight fluctuation over the past five years. In 2023, the inventory turnover ratio stood at 5.56, indicating that the company converted its inventory into sales approximately 5.56 times during the year. This figure was slightly higher than the previous year's ratio of 5.37 but lower than the ratio in 2021 of 5.60.

The trend over the last five years shows a relatively stable performance in managing inventory turnover, with ratios consistently above 5. This suggests that Avantor Inc has been efficient in managing its inventory levels relative to its sales volume. The company's ability to turn over its inventory multiple times a year indicates effective inventory management, which can help minimize carrying costs and reduce the risk of obsolete inventory.

Overall, a consistently high inventory turnover ratio reflects positively on Avantor Inc's operational efficiency and ability to effectively manage its inventory levels to meet customer demand. This trend is indicative of a well-managed supply chain and effective inventory control practices within the company.