Century Aluminum Company (CENX)
Inventory turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 2,139,800 | 2,929,400 | 2,148,000 | 1,641,600 | 1,860,500 |
| Inventory | US$ in thousands | 477,000 | 398,800 | 425,600 | 291,100 | 320,600 |
| Inventory turnover | 4.49 | 7.35 | 5.05 | 5.64 | 5.80 |
December 31, 2023 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $2,139,800K ÷ $477,000K
= 4.49
Century Aluminum Company's inventory turnover ratio has fluctuated over the past five years. In 2023, the company's inventory turnover ratio decreased to 4.49 from 7.35 in 2022, indicating that the company was able to sell its inventory less frequently during the year. This may suggest potential issues with managing inventory levels or slower sales.
Comparing the 2023 figure to the ratios of the previous years, it is lower than the ratios from 2021, 2020, and 2019, indicating a decline in inventory turnover efficiency. However, it is higher than the ratio in 2018. This suggests that the company may be facing challenges in effectively managing its inventory to meet demand and optimize working capital.
A lower inventory turnover ratio may indicate excess or obsolete inventory, which can tie up capital and lead to increased holding costs. It may also suggest potential inefficiencies in the company's supply chain or sales processes. Management should closely monitor inventory levels and sales performance to ensure optimal inventory turnover in the future.
Peer comparison
Dec 31, 2023