Colgate-Palmolive Company (CL)

Inventory turnover

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	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
Cost of revenue (ttm)	US$ in thousands	7,940,000	7,977,000	8,056,000	8,099,000	8,131,000	8,186,000	8,055,000	7,950,000	7,719,000	7,508,000	7,392,000	7,166,000	7,046,000	6,883,000	6,705,000	6,529,000	6,454,000	6,374,000	6,373,000	6,403,000
Inventory	US$ in thousands	1,987,000	2,041,000	1,922,000	1,914,000	1,934,000	1,931,000	2,039,000	2,110,000	2,074,000	2,073,000	2,012,000	1,924,000	1,692,000	1,670,000	1,700,000	1,676,000	1,673,000	1,578,000	1,524,000	1,301,000
Inventory turnover		4.00	3.91	4.19	4.23	4.20	4.24	3.95	3.77	3.72	3.62	3.67	3.72	4.16	4.12	3.94	3.90	3.86	4.04	4.18	4.92

December 31, 2024 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $7,940,000K ÷ $1,987,000K
= 4.00

The inventory turnover ratio measures how efficiently a company manages its inventory by showing how many times it sells and replaces its inventory within a specific period.

Analyzing Colgate-Palmolive Company's inventory turnover data from March 2020 to December 2024, we notice fluctuations over time. The ratio decreased from 4.92 in March 2020 to 3.67 in June 2022, indicating a slower inventory turnover. This may suggest challenges in managing inventory levels or decreasing sales.

Subsequently, there was a slight increase in inventory turnover, reaching 4.24 by September 2023, which could indicate improved inventory management or increased sales efficiency. This trend continued until December 2024, with the turnover ratio settling at 4.00.

Overall, Colgate-Palmolive's inventory turnover ratio has shown fluctuations, but it has generally remained at a moderate level, indicating reasonable efficiency in managing its inventory levels and sales operations. However, the company may want to focus on sustaining or improving this ratio to optimize its working capital and overall operational efficiency.