Peabody Energy Corp (BTU)
Inventory turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 3,420,900 | 3,385,100 | 3,290,800 | 2,553,100 | 2,524,900 |
| Inventory | US$ in thousands | 393,400 | 351,800 | 296,100 | 226,700 | 261,600 |
| Inventory turnover | 8.70 | 9.62 | 11.11 | 11.26 | 9.65 |
December 31, 2024 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $3,420,900K ÷ $393,400K
= 8.70
Inventory turnover is a key financial ratio that measures the efficiency with which a company manages its inventory.
Looking at the data provided for Peabody Energy Corp, we observe a trend in inventory turnover over the years. In 2020, the inventory turnover was 9.65, indicating that the company's inventory was turned over approximately 9.65 times during that year.
Subsequently, there was an improvement in inventory turnover as it increased to 11.26 in 2021 and slightly decreased to 11.11 in 2022, showcasing a more efficient management of inventory during these years. However, in 2023, the inventory turnover decreased to 9.62, and further dropped to 8.70 in 2024.
The decreasing trend in inventory turnover from 2022 to 2024 may suggest that Peabody Energy Corp is taking longer to sell its inventory or may be carrying excess inventory levels relative to sales. It is important for the company to monitor this ratio closely as a declining inventory turnover could indicate inefficiencies in inventory management, tying up capital in unsold inventory, and potentially leading to higher holding costs.
Overall, while the company saw fluctuations in its inventory turnover ratio over the years, it is essential for Peabody Energy Corp to continuously assess and optimize its inventory management practices to ensure effective utilization of resources and maintain healthy operational efficiency.
Peer comparison
Dec 31, 2024