Southwest Airlines Company (LUV)
Fixed asset turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 25,857,000 | 23,322,000 | 15,381,000 | 9,048,000 | 22,426,000 |
| Property, plant and equipment | US$ in thousands | 19,250,000 | 17,342,000 | 14,842,000 | 15,831,000 | 17,025,000 |
| Fixed asset turnover | 1.34 | 1.34 | 1.04 | 0.57 | 1.32 |
December 31, 2023 calculation
Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $25,857,000K ÷ $19,250,000K
= 1.34
Southwest Airlines Co's fixed asset turnover has fluctuated over the past five years. In 2023 and 2022, the company's fixed asset turnover was 1.35 and 1.37 respectively, indicating that the company generated $1.35 and $1.37 in revenue for every $1 of fixed assets invested. These ratios suggest efficient utilization of fixed assets to generate revenue.
However, in 2021 and 2020, the fixed asset turnover was 1.06 and 0.57 respectively, showing a decline in efficiency in utilizing fixed assets to generate revenue during those years. This decrease may raise concerns about the company's asset management efficiency during those periods.
In 2019, Southwest Airlines Co's fixed asset turnover was 1.32, indicating a more efficient utilization of fixed assets compared to 2021 and 2020 but slightly lower than the ratios in 2022 and 2023.
Overall, the trend in fixed asset turnover for Southwest Airlines Co indicates some variability over the years, with periods of efficient asset utilization for revenue generation interspersed with less efficient periods. This metric can be useful for assessing the company's operational efficiency and effectiveness in using its fixed assets to generate sales.
Peer comparison
Dec 31, 2023