MGP Ingredients Inc (MGPI)
Inventory turnover
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cost of revenue (ttm) | US$ in thousands | 417,308 | 440,730 | 483,260 | 508,393 | 531,811 | 529,850 | 533,772 | 536,824 | 529,052 | 515,364 | 492,791 | 475,145 | 427,755 | 382,845 | 343,122 | 296,868 | 296,715 | 298,434 | 290,527 | 289,648 |
| Inventory | US$ in thousands | 364,944 | 372,153 | 358,567 | 348,934 | 346,853 | 342,401 | 343,826 | 308,558 | 289,722 | 275,478 | 272,948 | 259,517 | 245,944 | 239,312 | 232,292 | 136,087 | 141,011 | 142,798 | 147,108 | 142,774 |
| Inventory turnover | 1.14 | 1.18 | 1.35 | 1.46 | 1.53 | 1.55 | 1.55 | 1.74 | 1.83 | 1.87 | 1.81 | 1.83 | 1.74 | 1.60 | 1.48 | 2.18 | 2.10 | 2.09 | 1.97 | 2.03 |
December 31, 2024 calculation
Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $417,308K ÷ $364,944K
= 1.14
The inventory turnover of MGP Ingredients Inc has fluctuated over the years based on the provided data. The inventory turnover ratio indicates how efficiently the company is managing its inventory. A higher turnover ratio suggests that a company is selling goods quickly and efficiently.
Based on the data, MGP Ingredients Inc's inventory turnover ratio ranged from 1.14 to 2.18 during the period from December 31, 2020, to December 31, 2024. The highest inventory turnover was recorded on March 31, 2021, at 2.18, indicating the company was able to sell and replace its inventory more than twice during that period.
However, there was a decline in inventory turnover from June 30, 2021, with a ratio of 1.48, until December 31, 2024, where the ratio decreased to 1.14. This downward trend may suggest that the company's inventory management efficiency decreased over time, and the company may be holding onto inventory for a longer period before selling it.
It is essential for MGP Ingredients Inc to closely monitor its inventory turnover ratio to ensure optimal inventory management, minimize carrying costs, and avoid stockouts. Analyzing the reasons behind the fluctuations in inventory turnover can help the company make informed decisions to improve efficiency and profitability.