California Water Service Group (CWT)

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	371,386	367,894	367,006	364,717	362,142	362,984	360,368	359,438	356,396	356,413	354,909	350,092	349,403	327,387	325,250	324,058	323,475	314,304	313,726	312,362
Inventory	US$ in thousands	16,170	15,454	13,862	13,287	12,564	10,994	10,567	10,526	9,511	9,383	9,589	9,201	8,831	8,611	8,375	8,135	7,745	7,804	6,989	6,444
Inventory turnover		22.97	23.81	26.48	27.45	28.82	33.02	34.10	34.15	37.47	37.98	37.01	38.05	39.57	38.02	38.84	39.84	41.77	40.27	44.89	48.47

December 31, 2023 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $371,386K ÷ $16,170K
= 22.97

The inventory turnover for California Water Service Group has shown a declining trend over the past 8 quarters, dropping from 25.54 in Q1 2022 to 16.67 in Q4 2023. This indicates that the company is taking longer to sell its inventory. A lower inventory turnover ratio can suggest inefficiencies in inventory management, such as overstocking or slow-moving inventory. It may also indicate potential liquidity issues if inventory is not being converted into sales quickly enough. Management should closely monitor and address the factors contributing to this decline to optimize inventory levels and improve overall operational efficiency.