Green Plains Renewable Energy Inc (GPRE)

Inventory turnover

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	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
Cost of revenue (ttm)	US$ in thousands	2,328,346	2,382,918	2,613,591	2,867,680	3,103,838	3,345,726	3,491,284	3,577,507	3,525,011	3,396,969	3,170,291	2,888,385	2,625,109	2,392,379	2,095,820	1,887,166	2,058,970	2,276,010	2,510,889	3,009,134
Inventory	US$ in thousands	178,944	161,260	170,900	165,963	169,912	187,603	230,103	253,613	217,065	207,784	291,325	308,809	195,518	209,372	249,819	232,901	229,344	164,682	154,421	192,927
Inventory turnover		13.01	14.78	15.29	17.28	18.27	17.83	15.17	14.11	16.24	16.35	10.88	9.35	13.43	11.43	8.39	8.10	8.98	13.82	16.26	15.60

December 31, 2024 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $2,328,346K ÷ $178,944K
= 13.01

Inventory turnover is a crucial financial ratio that measures how efficiently a company manages its inventory. For Green Plains Renewable Energy Inc, the inventory turnover has shown fluctuations over the years based on the provided data.

In the first quarter of 2020, the inventory turnover stood at 15.60, indicating that inventory was being sold and replenished approximately 15.60 times during that period. The ratio increased in the subsequent quarter to 16.26 and then decreased in the following quarters. By the end of 2020, the inventory turnover had dropped to 8.98, suggesting a slower rate of inventory turnover.

Throughout 2021 and early 2022, the inventory turnover remained relatively low, hovering around single-digit figures, indicating a longer time to sell inventory or manage stock levels efficiently. However, there was a gradual improvement in the inventory turnover starting from the third quarter of 2022, reaching a peak of 18.27 by the end of 2023. This indicates a higher sales volume relative to the level of inventory held by the company.

Overall, the trend suggests that Green Plains Renewable Energy Inc made efforts to enhance its inventory management practices, resulting in a steady improvement in inventory turnover from late 2022 towards the end of 2024. A higher inventory turnover ratio generally signifies better liquidity, efficient sales strategies, and effective demand forecasting.