Charles River Laboratories (CRL)

Days of inventory on hand (DOH)

		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
Inventory turnover		3.61	4.63	4.74	4.91	3.23	2.92	2.83	3.45	3.81	4.17	3.77	3.56	3.57	3.57	3.84	3.94	3.90	3.79	4.21	4.23
DOH	days	101.16	78.78	77.00	74.36	112.87	125.16	128.92	105.78	95.73	87.56	96.92	102.44	102.25	102.13	95.11	92.59	93.59	96.42	86.67	86.37

December 31, 2023 calculation

DOH = 365 ÷ Inventory turnover
= 365 ÷ 3.61
= 101.16

The Days of Inventory on Hand (DOH) ratio for Charles River Laboratories has varied over the past few quarters. The DOH measures how many days, on average, it takes for a company to turn its inventory into sales.

From the data provided, it is observed that the DOH ratio for Charles River Laboratories has fluctuated between 74.36 days to 128.92 days in recent quarters. A lower DOH value, such as 74.36 days in March 2023, indicates that the company is selling its inventory more quickly, which is generally positive as it signifies efficient inventory management.

However, the DOH ratio increased significantly to 128.92 days in June 2022 but has since been decreasing gradually. This spike in DOH might suggest inventory management issues during that period, where inventory turnover was relatively slower.

It's important to note that a high DOH ratio could also indicate obsolete inventory or difficulties in selling products, leading to potential write-downs and lower profitability. Therefore, Charles River Laboratories should aim to maintain an optimal balance in managing its inventory levels to ensure operational efficiency and cost control.