Hexcel Corporation (HXL)

Fixed asset turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Revenue	US$ in thousands	1,758,000	1,541,500	1,286,400	1,460,600	2,310,200
Property, plant and equipment	US$ in thousands	1,678,700	1,657,800	1,746,100	1,874,200	1,942,800
Fixed asset turnover		1.05	0.93	0.74	0.78	1.19

December 31, 2023 calculation

Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $1,758,000K ÷ $1,678,700K
= 1.05

The fixed asset turnover ratio measures a company's ability to generate sales revenue from its investment in fixed assets. Hexcel Corp.'s fixed asset turnover has shown some fluctuations over the past five years. In 2023, the ratio improved to 1.07 from 0.95 in 2022, indicating that the company generated $1.07 in sales for every dollar invested in fixed assets in 2023. This suggests that Hexcel Corp. efficiently utilized its fixed assets to generate revenue in 2023 compared to the previous year.

Looking further back, the ratio was relatively low in 2021 at 0.76, indicating lower efficiency in generating sales from fixed assets that year. However, it improved in 2022 and further increased in 2023, indicating a positive trend in asset utilization. In 2019, the ratio was 1.21, showing a higher level of efficiency in utilizing fixed assets compared to 2023.

Overall, Hexcel Corp.'s fixed asset turnover has shown variability over the past five years, with improvements in recent years indicating better utilization of fixed assets to generate sales revenue. An increasing trend in this ratio is generally a positive indicator of operational efficiency and effective management of fixed assets.