Leslies Inc (LESL)
Inventory turnover
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | ||
|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 1,383,170 | 1,354,140 | 1,160,380 |
| Inventory | US$ in thousands | 311,837 | 361,686 | 198,789 |
| Inventory turnover | 4.44 | 3.74 | 5.84 |
September 30, 2023 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $1,383,170K ÷ $311,837K
= 4.44
Inventory turnover is a crucial financial ratio that indicates how efficiently a company manages its inventory. In the case of Leslies Inc, the inventory turnover has fluctuated over the past three years.
In 2021, the inventory turnover was 5.84, meaning that the company sold and replaced its inventory approximately 5.84 times during the year. This high turnover rate suggests efficient inventory management.
However, in 2022, the inventory turnover decreased to 3.74, indicating that the company was selling and replacing its inventory at a slower rate compared to the previous year. This might be a cause for concern as a lower turnover rate could result in an overstock of inventory or obsolete products.
The inventory turnover improved in 2023 to 4.44, indicating a better performance in managing inventory compared to the previous year. Despite the improvement, the current turnover rate is still lower than the 2021 levels, suggesting that Leslies Inc may benefit from further optimizing its inventory management processes.
Overall, the trend in Leslies Inc's inventory turnover shows some variability, and it is important for the company to consistently monitor and improve its inventory turnover to ensure efficient operations and maximize profitability.
Peer comparison
Sep 30, 2023