McCormick & Company Incorporated (MKC)
Fixed asset turnover
| Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | May 31, 2023 | Feb 28, 2023 | Nov 30, 2022 | Aug 31, 2022 | May 31, 2022 | Feb 28, 2022 | Nov 30, 2021 | Aug 31, 2021 | May 31, 2021 | Feb 28, 2021 | Nov 30, 2020 | Aug 31, 2020 | May 31, 2020 | Feb 29, 2020 | Nov 30, 2019 | Aug 31, 2019 | May 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (ttm) | US$ in thousands | 6,699,400 | 6,662,200 | 6,605,100 | 6,516,000 | 6,393,600 | 6,350,500 | 6,385,100 | 6,338,900 | 6,358,800 | 6,317,900 | 6,145,500 | 6,026,400 | 5,870,800 | 5,601,300 | 5,528,200 | 5,427,100 | 5,327,900 | 5,347,400 | 5,330,500 | 5,319,500 |
| Property, plant and equipment | US$ in thousands | 1,354,500 | 1,324,700 | 1,285,700 | 1,249,600 | 1,225,200 | 1,198,000 | 1,139,100 | 1,136,100 | 1,135,900 | 1,140,300 | 1,113,500 | 1,112,800 | 1,070,800 | 1,028,400 | 960,900 | 927,000 | 936,000 | 952,600 | 910,000 | 917,400 |
| Fixed asset turnover | 4.95 | 5.03 | 5.14 | 5.21 | 5.22 | 5.30 | 5.61 | 5.58 | 5.60 | 5.54 | 5.52 | 5.42 | 5.48 | 5.45 | 5.75 | 5.85 | 5.69 | 5.61 | 5.86 | 5.80 |
February 29, 2024 calculation
Fixed asset turnover = Revenue (ttm) ÷ Property, plant and equipment
= $6,699,400K ÷ $1,354,500K
= 4.95
The fixed asset turnover ratio for McCormick & Company Incorporated has demonstrated a consistent and generally increasing trend over the past 20 periods, ranging from 4.95 to 5.86. This implies that, on average, the company generates $5.95 in sales for every dollar invested in fixed assets.
The upward trend in the fixed asset turnover ratio indicates that McCormick has been effectively utilizing its fixed assets to generate revenue over time. A higher fixed asset turnover ratio is generally favorable as it indicates that the company is efficiently using its fixed assets to drive sales.
It is worth noting that the ratio fluctuates slightly period to period, but the overall trend shows an improvement in the utilization of fixed assets to generate revenue. This efficiency in asset utilization can be a positive sign of effective operations and management within the company.