MGE Energy Inc (MGEE)
Inventory turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 25,769 | 22,823 | 19,542 | 19,535 | 18,460 |
| Inventory | US$ in thousands | 67,645 | 72,648 | 74,275 | 51,960 | 47,265 |
| Inventory turnover | 0.38 | 0.31 | 0.26 | 0.38 | 0.39 |
December 31, 2024 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $25,769K ÷ $67,645K
= 0.38
Based on the provided data, the inventory turnover of MGE Energy Inc has fluctuated over the past five years. The inventory turnover ratio indicates how efficiently a company manages its inventory by showing how many times it sells and replaces its inventory during a specific period.
In 2020, the inventory turnover was 0.39, which means that the company sold and replaced its inventory approximately 0.39 times during that year. This ratio decreased slightly to 0.38 in 2021 before dropping significantly to 0.26 in 2022. The low ratio in 2022 suggests that the company may have been holding onto excess inventory or facing challenges in selling its products.
However, there was a modest improvement in the inventory turnover ratio in 2023, increasing to 0.31, indicating a slight improvement in inventory management efficiency. In 2024, the ratio returned to 0.38, which is closer to the 2020 level.
Overall, the varying inventory turnover ratios suggest that MGE Energy Inc may have experienced fluctuations in its inventory management practices and sales performance over the past five years. Further analysis would be needed to understand the specific reasons behind these changes and to assess the company's overall inventory management effectiveness.