MDU Resources Group Inc (MDU)

Inventory turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cost of revenue	US$ in thousands	2,991,870	5,007,040	4,104,940	4,058,930	3,917,480
Inventory	US$ in thousands	87,392	64,248	335,609	291,167	278,407
Inventory turnover		34.24	77.93	12.23	13.94	14.07

December 31, 2023 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $2,991,870K ÷ $87,392K
= 34.24

The inventory turnover ratio for MDU Resources Group Inc has shown a significant improvement over the years, indicating a more efficient management of its inventory. The ratio has steadily increased from 1.57 in 2020 to 9.74 in 2023. This suggests that the company is selling its inventory at a faster rate, which could be attributed to better inventory management practices, improved demand forecasting, or more effective sales and marketing strategies.

A higher inventory turnover ratio is generally viewed positively as it indicates that the company is selling its products quickly and not holding excess inventory. This can lead to lower storage costs, reduced risk of obsolescence, and improved cash flow.

The sharp increase in inventory turnover from 2022 to 2023 is particularly noteworthy, as it reflects a notable improvement in the company's ability to efficiently convert inventory into sales within a shorter time period. Overall, the trend in inventory turnover for MDU Resources Group Inc suggests a positive operational performance in managing its inventory levels.