Materion Corporation (MTRN)
Fixed asset turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 1,633,630 | 1,735,870 | 1,504,450 | 1,174,500 | 1,182,840 |
| Property, plant and equipment | US$ in thousands | 514,683 | 448,765 | 408,975 | 309,686 | 232,276 |
| Fixed asset turnover | 3.17 | 3.87 | 3.68 | 3.79 | 5.09 |
December 31, 2023 calculation
Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $1,633,630K ÷ $514,683K
= 3.17
Materion Corp's fixed asset turnover has exhibited fluctuations over the past five years. The ratio measures how efficiently the company generates sales revenue from its fixed assets. A higher fixed asset turnover indicates better asset utilization.
A downward trend is observed in the fixed asset turnover ratio from 2019 to 2023, declining from 5.10 to 3.24. This trend suggests that Materion Corp is generating less revenue per dollar of fixed assets invested over the years. A potential cause could be over-investment in fixed assets relative to sales growth or a decrease in sales efficiency.
Despite the declining trend, Materion Corp's fixed asset turnover remains above 3.0, indicating that the company is still effective in utilizing its fixed assets to generate revenue. However, management may need to monitor and potentially optimize asset utilization strategies to improve efficiency and profitability in the future.