Kimberly-Clark Corporation (KMB)
Fixed asset turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 20,400,000 | 20,175,000 | 19,400,000 | 19,140,000 | 18,450,000 |
| Property, plant and equipment | US$ in thousands | 7,913,000 | 7,885,000 | 8,097,000 | 8,042,000 | 7,450,000 |
| Fixed asset turnover | 2.58 | 2.56 | 2.40 | 2.38 | 2.48 |
December 31, 2023 calculation
Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $20,400,000K ÷ $7,913,000K
= 2.58
Kimberly-Clark Corp.'s fixed asset turnover has shown a generally increasing trend over the past five years, indicating improved efficiency in generating sales revenue from its fixed assets. The company's fixed asset turnover ratio ranged from 2.38 in 2019 to 2.58 in 2023. This suggests that Kimberly-Clark is effectively utilizing its fixed assets to generate sales, with each dollar invested in fixed assets producing, on average, $2.58 of sales revenue in 2023.
The upward trend in fixed asset turnover reflects management's ability to optimize the utilization of fixed assets, thereby potentially improving profitability and return on assets. This trend could be attributed to various factors, such as effective asset management practices, strategic investments in productive assets, or operational efficiencies leading to increased revenue generation with the existing fixed asset base.
It is important for Kimberly-Clark to continue monitoring and potentially improving its fixed asset turnover ratio to ensure sustained efficiency in asset utilization and maximize profitability. Additionally, comparing this ratio to industry benchmarks can provide further insights into the company's competitiveness and efficiency relative to its peers.
Peer comparison
Dec 31, 2023