Chart Industries Inc (GTLS)
Days of inventory on hand (DOH)
| 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Inventory turnover | 7.07 | 6.42 | 7.22 | 7.90 | 6.27 | 5.22 | 3.57 | 2.20 | 3.37 | 3.31 | 3.11 | 3.02 | 3.09 | 2.70 | 2.78 | 3.01 | 3.49 | 3.78 | 3.87 | 4.12 | |
| DOH | days | 51.64 | 56.88 | 50.55 | 46.17 | 58.21 | 69.91 | 102.22 | 166.28 | 108.41 | 110.15 | 117.20 | 120.81 | 118.12 | 135.14 | 131.23 | 121.38 | 104.60 | 96.47 | 94.42 | 88.60 |
December 31, 2024 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 7.07
= 51.64
Chart Industries Inc's days of inventory on hand (DOH) has displayed fluctuating trends over the past few years. From March 31, 2020, to September 30, 2021, the DOH gradually increased from 88.60 days to 135.14 days, indicating a trend of holding inventory for a longer period. This increase could suggest potential inefficiencies in inventory management or slowing sales.
However, from December 31, 2021, to June 30, 2024, there was a notable decrease in DOH from 118.12 days to 50.55 days. This drop may signal improvements in inventory turnover and more efficient inventory management practices. The decline in DOH can be favorable as it implies quicker conversion of inventory into sales, reducing the risk of obsolescence and working capital tied up in inventory.
The spike in DOH to 166.28 days on March 31, 2023, followed by a sharp decline to 46.17 days on March 31, 2024, indicates potential irregularities or fluctuations in production, sales patterns, or supply chain disruptions during this period. An excessively high DOH could lead to increased carrying costs and risks associated with inventory storage, while a very low DOH may suggest stockouts and potential lost sales opportunities.
Overall, monitoring and effectively managing the DOH is crucial for Chart Industries Inc to maintain an optimal balance between holding enough inventory to meet demand without overstocking, ensuring efficient operations, and maximizing profitability.