McCormick & Company Incorporated (MKC)
Fixed asset turnover
| Nov 30, 2024 | Aug 31, 2024 | May 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (ttm) | US$ in thousands | 6,723,700 | 6,678,500 | 6,683,400 | 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 |
| Property, plant and equipment | US$ in thousands | 1,413,000 | 1,399,500 | 1,366,100 | 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 |
| Fixed asset turnover | 4.76 | 4.77 | 4.89 | 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 |
November 30, 2024 calculation
Fixed asset turnover = Revenue (ttm) ÷ Property, plant and equipment
= $6,723,700K ÷ $1,413,000K
= 4.76
The fixed asset turnover ratio for McCormick & Company Incorporated has exhibited relatively stable performance over the past few years, ranging from a high of 5.85 in May 2020 to a low of 4.76 in November 2024. This ratio measures how efficiently the company is utilizing its fixed assets to generate sales revenue, with higher values indicating better asset utilization.
The trend in the fixed asset turnover ratio shows a general decline from 2020 to 2024, which may suggest potential inefficiencies in the management of fixed assets in generating sales. The slight fluctuations in the ratio indicate some variability in asset utilization efficiency but overall remain within a reasonably consistent range.
It is essential for the company to closely monitor and manage its fixed asset turnover to ensure optimal efficiency in utilizing its property, plant, and equipment in generating revenue. Any significant deviations in this ratio may signal the need for adjustments in operational processes or strategic decisions to enhance asset productivity and profitability.