KAR Auction Services Inc (KAR)

Fixed asset turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Revenue	US$ in thousands	1,645,100	1,519,400	1,450,600	1,326,900	2,781,900
Property, plant and equipment	US$ in thousands	169,800	123,600	143,500	589,900	609,000
Fixed asset turnover		9.69	12.29	10.11	2.25	4.57

December 31, 2023 calculation

Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $1,645,100K ÷ $169,800K
= 9.69

Fixed asset turnover is a financial ratio that measures a company's ability to generate sales revenue from its investment in fixed assets. A higher fixed asset turnover indicates that the company is more efficient in utilizing its fixed assets to generate sales.

Analyzing the fixed asset turnover of Openlane Inc. over the past five years, we can see a fluctuating trend. In 2023, the fixed asset turnover is 9.69, a decrease from the previous year's ratio of 12.29 in 2022. This decline suggests that the company's efficiency in generating sales from its fixed assets decreased during this period.

On the other hand, looking further back, in 2021, the fixed asset turnover was 3.89, showing a significant increase compared to previous years. This improvement indicates that Openlane Inc. became more effective in utilizing its fixed assets to generate sales revenue in 2021.

In 2020 and 2019, the fixed asset turnover ratios were 3.71 and 4.57, respectively, indicating a relatively stable performance in utilizing fixed assets to generate sales revenue during these years.

Overall, it is essential for Openlane Inc. to closely monitor and manage its fixed asset turnover to ensure optimal efficiency in utilizing its fixed assets to drive sales and profitability. Further analysis and comparison with industry benchmarks may provide valuable insights into the company's performance in this area.