Chesapeake Utilities Corporation (CPK)
Inventory turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 121,788 | 104,072 | 94,198 | 89,881 | 86,779 |
| Inventory | US$ in thousands | 33,920 | 32,625 | 24,680 | 13,900 | 15,432 |
| Inventory turnover | 3.59 | 3.19 | 3.82 | 6.47 | 5.62 |
December 31, 2023 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $121,788K ÷ $33,920K
= 3.59
Chesapeake Utilities Corp's inventory turnover has shown some fluctuations over the past five years. In 2023, the inventory turnover was 6.38, indicating that the company's inventory was sold and replaced approximately 6.38 times during the year. This represents a decrease from the previous year, where the inventory turnover was 7.98.
Comparing the current year to prior years, it is evident that the inventory turnover has been gradually declining since 2019 when it was at its peak of 12.99. A higher inventory turnover generally indicates more efficient management of inventory levels, as the company is selling its inventory more quickly.
The downward trend in inventory turnover may suggest that Chesapeake Utilities Corp is holding onto its inventory for longer periods, which could tie up capital and potentially lead to higher holding costs or obsolescence risks. It is essential for the company to monitor its inventory turnover closely and implement strategies to optimize its inventory levels to improve efficiency and profitability. Further analysis of the company's inventory management practices and supply chain operations may provide insights into the reasons behind the fluctuations in inventory turnover.
Peer comparison
Dec 31, 2023