Kontoor Brands Inc (KTB)

Fixed asset turnover

		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
Revenue (ttm)	US$ in thousands	2,610,986	2,571,058	2,544,950	2,544,398	2,579,338	2,637,077	2,590,654	2,589,646	2,604,516	2,540,463	2,588,165	2,465,948	2,434,204	2,469,159	2,394,349	2,247,901	2,097,839	2,049,753	2,117,336	2,390,409
Property, plant and equipment	US$ in thousands	103,300	106,842	108,150	110,304	112,045	110,399	106,878	104,999	104,465	101,407	101,994	101,380	105,155	106,959	109,487	113,693	118,897	122,739	124,939	129,884
Fixed asset turnover		25.28	24.06	23.53	23.07	23.02	23.89	24.24	24.66	24.93	25.05	25.38	24.32	23.15	23.09	21.87	19.77	17.64	16.70	16.95	18.40

December 31, 2024 calculation

Fixed asset turnover = Revenue (ttm) ÷ Property, plant and equipment
= $2,610,986K ÷ $103,300K
= 25.28

The fixed asset turnover ratio measures how efficiently a company generates revenue from its fixed assets. It is calculated by dividing net sales by average fixed assets. For Kontoor Brands Inc, the fixed asset turnover ratio has shown a positive trend over the period from March 31, 2020, to December 31, 2024.

The ratio increased steadily from 18.40 in March 31, 2020, to a peak of 25.28 in December 31, 2024. This indicates that the company was able to generate more sales relative to its investment in fixed assets during this period. A higher fixed asset turnover ratio generally signifies better asset utilization and efficiency in generating sales.

However, it's important to note that a very high fixed asset turnover ratio may suggest that the company is potentially operating too lean or may have older fixed assets that need replacement. Therefore, continuous monitoring of this ratio alongside other financial metrics is crucial for a comprehensive assessment of Kontoor Brands Inc's operational performance and asset management capabilities.