Gates Industrial Corporation plc (GTES)
Days of inventory on hand (DOH)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Inventory turnover | 3.42 | 3.51 | 3.13 | 3.46 | 4.09 | |
| DOH | days | 106.83 | 103.97 | 116.69 | 105.50 | 89.18 |
December 31, 2023 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 3.42
= 106.83
The days of inventory on hand (DOH) for Gates Industrial Corporation plc has varied over the past five years. In the most recent year, as of Dec 31, 2023, the company held inventory for an average of 106.83 days before it was sold. This represents an increase from the prior year's DOH of 103.97 days. Looking further back, the trend shows fluctuations in inventory management efficiency, with DOH reaching a peak of 116.69 days in 2021 before decreasing to 105.50 days in 2020 and further dropping to 89.18 days in 2019.
A higher DOH indicates that the company is taking longer to sell its inventory, which may tie up more capital and could potentially indicate overstocking or slow-moving inventory. Conversely, a lower DOH suggests a more efficient inventory turnover, which is generally favorable for liquidity and working capital management.
It would be beneficial for Gates Industrial Corporation plc to analyze the reasons behind the fluctuations in DOH over the years and take appropriate actions to optimize inventory management, ensuring a balance between avoiding stockouts and minimizing excess inventory levels to enhance profitability and operational efficiency.
Peer comparison
Dec 31, 2023