Carrier Global Corp (CARR)
Fixed asset turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|
| Revenue | US$ in thousands | 21,458,000 | 21,970,000 | 20,292,000 | 18,281,000 |
| Property, plant and equipment | US$ in thousands | 2,293,000 | 2,241,000 | 1,826,000 | 1,810,000 |
| Fixed asset turnover | 9.36 | 9.80 | 11.11 | 10.10 |
December 31, 2023 calculation
Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $21,458,000K ÷ $2,293,000K
= 9.36
Fixed asset turnover is calculated by dividing net sales by average fixed assets. A higher fixed asset turnover ratio indicates that the company is generating more revenue per dollar of fixed assets, which is a positive sign of operational efficiency.
Looking at the trend in Carrier Global Corp's fixed asset turnover ratio over the past five years, we observe some fluctuations. In 2021, the fixed asset turnover ratio was notably high at 11.29, indicating that the company generated $11.29 in sales for every dollar invested in fixed assets. This implies efficient utilization of its fixed assets to generate revenue.
In the subsequent year, 2022, the fixed asset turnover ratio decreased slightly to 9.11, suggesting a decrease in the efficiency of generating sales from fixed assets compared to the previous year. However, in 2023, the ratio improved to 9.64, indicating a better utilization of fixed assets for revenue generation compared to 2022.
Overall, Carrier Global Corp has demonstrated reasonable efficiency in generating sales from its fixed assets over the past five years, with fluctuations in the ratio reflecting changes in operational efficiency. It is essential for the company to monitor and manage its fixed asset turnover ratio to ensure optimal utilization of fixed assets to drive revenue growth.
Peer comparison
Dec 31, 2023