Eli Lilly and Company (LLY)

Fixed asset turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Revenue	US$ in thousands	34,124,100	28,541,400	28,318,400	24,539,800	22,319,500
Property, plant and equipment	US$ in thousands	12,913,600	10,144,000	8,985,100	8,681,900	7,872,900
Fixed asset turnover		2.64	2.81	3.15	2.83	2.83

December 31, 2023 calculation

Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $34,124,100K ÷ $12,913,600K
= 2.64

The fixed asset turnover ratio measures how efficiently a company is utilizing its fixed assets to generate revenue. A higher ratio indicates better utilization of fixed assets.

For Lilly(Eli) & Co, the fixed asset turnover ratio has fluctuated over the past five years. In 2023, the ratio was 2.64, a decrease from 2.81 in 2022, and significantly lower compared to 3.15 in 2021. This suggests that the company may have experienced a decline in efficiency in utilizing its fixed assets to generate revenue in 2023.

However, despite the year-over-year fluctuations, the company has generally maintained a relatively stable level of fixed asset turnover over the past five years, with ratios ranging from 2.64 to 3.15. This indicates that Lilly(Eli) & Co has been able to efficiently use its fixed assets to generate revenue, with only minor fluctuations in efficiency over the years.

It is important for the company to closely monitor its fixed asset turnover ratio and identify any factors influencing the fluctuations to ensure optimal utilization of fixed assets and maximize revenue generation in the future.