Chart Industries Inc (GTLS)
Days of inventory on hand (DOH)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Inventory turnover | 5.33 | 4.30 | 3.98 | 4.58 | 6.09 | |
| DOH | days | 68.52 | 84.95 | 91.69 | 79.65 | 59.95 |
December 31, 2023 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 5.33
= 68.52
Chart Industries Inc's Days of Inventory on Hand (DOH) has been fluctuating over the past five years, indicating potential variations in inventory management efficiency.
From December 31, 2019, to December 31, 2020, DOH increased significantly from 83.22 days to 107.30 days, suggesting a potential buildup of inventory relative to sales. This increase could be attributed to factors such as changes in demand forecasting, production inefficiencies, or supply chain disruptions.
Subsequently, from December 31, 2020, to December 31, 2021, DOH continued to rise to 118.12 days, indicating a prolonged inventory holding period. Such a high DOH could result in increased carrying costs and potential obsolescence risks for the company’s inventory.
However, from December 31, 2021, to December 31, 2022, there was a slight improvement in inventory management as DOH decreased to 108.41 days. This reduction suggests a potential optimization of inventory levels or enhanced inventory turnover efficiency during this period.
Finally, from December 31, 2022, to December 31, 2023, there was a further improvement in inventory management efficiency as DOH decreased to 90.98 days. This decline indicates a shorter period for which inventory is held by the company before being sold or utilized, which can positively impact cash flow and working capital management.
Overall, the fluctuating trend in Chart Industries Inc's DOH highlights the importance of ongoing monitoring and adjustment of inventory management practices to ensure optimal operational efficiency and financial performance.