Brady Corporation (BRC)
Fixed asset turnover
| Jul 31, 2024 | Jul 31, 2023 | Jul 31, 2022 | Jul 31, 2021 | Jul 31, 2020 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 1,341,390 | 1,332,090 | 1,300,790 | 1,144,700 | 1,081,300 |
| Property, plant and equipment | US$ in thousands | 195,758 | 142,149 | 139,511 | 121,741 | 115,068 |
| Fixed asset turnover | 6.85 | 9.37 | 9.32 | 9.40 | 9.40 |
July 31, 2024 calculation
Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $1,341,390K ÷ $195,758K
= 6.85
The fixed asset turnover ratio for Brady Corporation has shown a declining trend over the past five years. From 9.40 in both Jul 31, 2020, and Jul 31, 2021, the ratio decreased to 9.32 in Jul 31, 2022, and further dropped to 9.37 in Jul 31, 2023. The most significant decline was observed in the latest financial year ending Jul 31, 2024, where the fixed asset turnover ratio decreased to 6.85.
A high fixed asset turnover ratio typically indicates that a company is efficient in generating sales revenue from its investment in fixed assets. Therefore, the decreasing trend in Brady Corporation's fixed asset turnover may suggest that the company's utilization of its fixed assets to generate sales has become less efficient over the years.
It is important for the company to further investigate and address the factors contributing to the decline in the fixed asset turnover ratio to improve operational efficiency and potentially increase profitability in the future.
Peer comparison
Jul 31, 2024