Edgewell Personal Care Co (EPC)
Inventory turnover
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 1,310,800 | 1,291,200 | 1,136,100 | 1,068,800 | 1,174,400 |
| Inventory | US$ in thousands | 492,400 | 449,300 | 345,700 | 314,100 | 357,200 |
| Inventory turnover | 2.66 | 2.87 | 3.29 | 3.40 | 3.29 |
September 30, 2023 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $1,310,800K ÷ $492,400K
= 2.66
The inventory turnover ratio measures the efficiency of a company in managing its inventory. For Edgewell Personal Care Co, the inventory turnover has shown a declining trend over the past five years. In 2023, the inventory turnover ratio was 2.66, down from 2.88 in 2022 and 3.37 in 2021. This indicates that the company's inventory is now taking longer to sell compared to previous years.
A decreasing inventory turnover ratio can suggest overstocking, obsolete inventory, or declining sales. It may also indicate potential issues in sales forecasting or production planning. Management should closely monitor and evaluate inventory levels, as well as assess the demand for their products to address the declining turnover ratio. Additionally, the company may need to review its inventory management strategies to improve efficiency and avoid potential losses from excessive inventory holding costs.
Peer comparison
Sep 30, 2023