Central Garden & Pet Company A (CENTA)
Inventory turnover
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cost of revenue (ttm) | US$ in thousands | 3,138,351 | 3,139,487 | 3,093,103 | 3,089,263 | 3,105,825 | 3,113,752 | 3,130,030 | 3,152,565 | 3,135,682 | 3,065,688 | 2,799,520 | 2,447,109 | 2,112,579 | 1,898,951 | 1,811,317 | 1,727,185 | 1,698,723 | 1,678,969 | 1,642,045 | 1,610,633 |
| Inventory | US$ in thousands | 948,398 | 838,188 | 865,496 | 966,900 | 1,024,360 | 938,000 | 882,522 | 888,051 | 844,899 | 685,237 | 626,635 | 672,901 | 574,878 | 439,615 | 425,919 | 517,207 | 556,479 | 466,197 | 464,917 | 517,158 |
| Inventory turnover | 3.31 | 3.75 | 3.57 | 3.20 | 3.03 | 3.32 | 3.55 | 3.55 | 3.71 | 4.47 | 4.47 | 3.64 | 3.67 | 4.32 | 4.25 | 3.34 | 3.05 | 3.60 | 3.53 | 3.11 |
December 31, 2023 calculation
Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $3,138,351K ÷ $948,398K
= 3.31
Inventory turnover measures how efficiently a company manages its inventory by showing how many times the company sells and replaces its inventory during a specific period. A higher inventory turnover ratio indicates that the company is effectively selling its products and restocking its inventory, while a lower ratio may suggest overstocking or slow sales.
In the case of Central Garden & Pet Company A, the inventory turnover has fluctuated over the past few quarters, ranging from a low of 3.03 to a high of 4.47. The average inventory turnover ratio for the period is approximately 3.67.
The downward trend in inventory turnover from 4.47 in September 2021 to 3.20 in March 2023 may indicate potential issues such as overstocking, slow sales, or ineffective inventory management during this period. However, the recent increase in inventory turnover to 3.75 in September 2023 suggests an improvement in managing inventory levels.
Overall, Central Garden & Pet Company A has maintained a moderate to high inventory turnover ratio, indicating a reasonable level of efficiency in its inventory management practices. It is essential for the company to continually monitor and optimize its inventory turnover to ensure efficient operations and maximize profitability.
Peer comparison
Dec 31, 2023
Dec 31, 2023