FMC Corporation (FMC)
Fixed asset 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (ttm) | US$ in thousands | 4,475,000 | 4,961,900 | 5,367,100 | 5,804,900 | 5,818,300 | 5,592,300 | 5,402,800 | 5,191,300 | 5,034,800 | 4,780,000 | 4,671,900 | 4,586,400 | 4,642,100 | 4,687,200 | 4,616,900 | 4,667,700 | 4,609,800 | 4,954,400 | 4,863,700 | 4,812,000 |
| Property, plant and equipment | US$ in thousands | 892,500 | 872,500 | 867,900 | 862,700 | 849,600 | 789,600 | 797,400 | 804,100 | 817,000 | 782,200 | 776,700 | 764,200 | 771,700 | 739,200 | 733,800 | 735,700 | 758,000 | 728,400 | 730,300 | 733,800 |
| Fixed asset turnover | 5.01 | 5.69 | 6.18 | 6.73 | 6.85 | 7.08 | 6.78 | 6.46 | 6.16 | 6.11 | 6.02 | 6.00 | 6.02 | 6.34 | 6.29 | 6.34 | 6.08 | 6.80 | 6.66 | 6.56 |
December 31, 2023 calculation
Fixed asset turnover = Revenue (ttm) ÷ Property, plant and equipment
= $4,475,000K ÷ $892,500K
= 5.01
The fixed asset turnover ratio measures a company's efficiency in generating sales from its investments in fixed assets. A higher fixed asset turnover indicates that the company is utilizing its fixed assets more effectively to generate revenue.
Analyzing FMC Corp.'s fixed asset turnover from Q1 2022 to Q4 2023 shows a consistent trend of improvement, with the ratio steadily increasing from 6.47 in Q1 2022 to 6.72 in Q1 2023. This uptrend suggests that FMC Corp. has been able to generate more sales for each dollar invested in fixed assets over this period.
The peak fixed asset turnover of 6.83 in Q4 2022 indicates that the company was exceptionally efficient in utilizing its fixed assets to generate revenue during that quarter. Despite a slight decline in subsequent quarters, the ratios remained relatively high, indicating ongoing efficiency in capital utilization.
Overall, the trend of increasing fixed asset turnover ratios reflects positively on FMC Corp.'s operational efficiency and effective management of its fixed assets to drive revenue generation. It suggests that the company is making productive use of its fixed assets to support its sales activities and generate returns for shareholders.
Peer comparison
Dec 31, 2023