Howmet Aerospace Inc (HWM)
Fixed asset turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 6,422,000 | 5,433,000 | 4,565,000 | 4,881,000 | 13,875,000 |
| Property, plant and equipment | US$ in thousands | 2,328,000 | 2,332,000 | 2,467,000 | 2,592,000 | 2,629,000 |
| Fixed asset turnover | 2.76 | 2.33 | 1.85 | 1.88 | 5.28 |
December 31, 2023 calculation
Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $6,422,000K ÷ $2,328,000K
= 2.76
The fixed asset turnover ratio for Howmet Aerospace Inc has shown fluctuation over the past five years. In 2023, the company achieved a fixed asset turnover of 2.85, indicating that for every dollar invested in fixed assets, the company generated $2.85 in sales. This represents an improvement from the previous year when the ratio was 2.43.
The trend over the last five years reveals variations in the efficiency of Howmet Aerospace's utilization of its fixed assets to generate revenue. The ratio peaked in 2019 at 2.60 before dropping in 2021 to 2.02 and then recovering to 2.03 in 2020. The recent increase in 2023 suggests the company may have enhanced its operational efficiency and effectiveness in utilizing its fixed assets to drive sales.
Overall, the increasing trend in the fixed asset turnover ratio indicates that Howmet Aerospace is becoming more efficient in generating sales from its fixed assets, which reflects positively on the company's asset management and operational performance. Further analysis of the underlying factors influencing this ratio could provide additional insights into the company's strategic initiatives and future growth prospects.
Peer comparison
Dec 31, 2023