The Gap, Inc. (GAP)
Fixed asset turnover
| Aug 3, 2024 | May 4, 2024 | Feb 3, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 29, 2022 | Oct 30, 2021 | Jul 31, 2021 | May 1, 2021 | Jan 30, 2021 | Oct 31, 2020 | Aug 1, 2020 | May 2, 2020 | Feb 1, 2020 | Nov 2, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (ttm) | US$ in thousands | 15,173,000 | 15,001,000 | 14,889,000 | 14,834,000 | 15,106,000 | 15,415,000 | 15,616,000 | 15,898,000 | 15,802,000 | 16,156,000 | 16,670,000 | 16,569,000 | 16,620,000 | 15,684,000 | 13,800,000 | 14,050,000 | 14,054,000 | 14,784,000 | 16,383,000 | 16,332,000 |
| Property, plant and equipment | US$ in thousands | 2,525,000 | 2,528,000 | 2,566,000 | 2,552,000 | 2,595,000 | 2,646,000 | 2,688,000 | 2,788,000 | 2,809,000 | 2,791,000 | 3,037,000 | 2,924,000 | 2,897,000 | 2,839,000 | 2,841,000 | 2,846,000 | 2,895,000 | 2,945,000 | 3,122,000 | 3,225,000 |
| Fixed asset turnover | 6.01 | 5.93 | 5.80 | 5.81 | 5.82 | 5.83 | 5.81 | 5.70 | 5.63 | 5.79 | 5.49 | 5.67 | 5.74 | 5.52 | 4.86 | 4.94 | 4.85 | 5.02 | 5.25 | 5.06 |
August 3, 2024 calculation
Fixed asset turnover = Revenue (ttm) ÷ Property, plant and equipment
= $15,173,000K ÷ $2,525,000K
= 6.01
The fixed asset turnover ratio for The Gap, Inc. has fluctuated over the past several quarters, ranging from 4.86 to 6.01. A higher fixed asset turnover ratio indicates that the company is generating more sales revenue per dollar of investment in fixed assets. It shows how efficiently the company is using its fixed assets to generate sales.
The ratios ranging from 5.70 to 6.01 indicate relatively efficient utilization of fixed assets, with the company generating approximately $5.70 to $6.01 in sales for every dollar invested in fixed assets. However, the ratio fluctuates slightly over time, suggesting some variability in asset utilization efficiency.
The decrease in the fixed asset turnover ratio to 4.86 in the quarter ended January 30, 2021, could indicate either a decrease in sales relative to fixed assets or an increase in investment in fixed assets without a proportional increase in sales. This may be a point of concern for the company's management, as it suggests a potential inefficiency in asset utilization during that specific period.
Overall, while The Gap, Inc. has generally maintained a solid fixed asset turnover ratio, it is crucial for the company to monitor and manage its fixed asset investments effectively to ensure optimal utilization and financial performance.
Peer comparison
Aug 3, 2024