Lumen Technologies Inc (LUMN)
Fixed asset turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 14,557,000 | 17,478,000 | 19,687,000 | 20,712,000 | 21,458,000 |
| Property, plant and equipment | US$ in thousands | 19,758,000 | 19,166,000 | 20,895,000 | 26,338,000 | 26,079,000 |
| Fixed asset turnover | 0.74 | 0.91 | 0.94 | 0.79 | 0.82 |
December 31, 2023 calculation
Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $14,557,000K ÷ $19,758,000K
= 0.74
The fixed asset turnover ratio measures the efficiency of a company in generating revenue from its fixed assets. A higher ratio indicates better utilization of fixed assets to generate sales.
Looking at the trend in Lumen Technologies Inc's fixed asset turnover over the past five years, we observe some fluctuations. The ratio decreased from 0.86 in 2019 to 0.79 in 2020, suggesting a potential decline in revenue generated relative to fixed assets during that period.
However, there was a subsequent increase in 2021 to 0.94, indicating improved efficiency in asset utilization. This positive trend continued in 2022 with a ratio of 0.91.
Nevertheless, in 2023, the ratio declined to 0.74, potentially signaling a decrease in revenue generated per dollar of fixed assets invested. This reversal may prompt further investigation into the company's operational efficiency and asset management strategies.
Overall, despite the fluctuations, it is essential for stakeholders to closely monitor the fixed asset turnover ratio to assess Lumen Technologies Inc's ability to effectively utilize its fixed assets to drive revenue generation.
Peer comparison
Dec 31, 2023