Materion Corporation (MTRN)
Inventory turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 1,503,030 | 1,610,150 | 1,407,620 | 1,158,240 | 1,103,760 |
| Inventory | US$ in thousands | 441,597 | 423,080 | 361,115 | 250,778 | 236,253 |
| Inventory turnover | 3.40 | 3.81 | 3.90 | 4.62 | 4.67 |
December 31, 2023 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $1,503,030K ÷ $441,597K
= 3.40
Based on the inventory turnover data of Materion Corp from 2019 to 2023, it is observed that the company's inventory turnover has been declining over the years. In 2019, the inventory turnover stood at 4.87 times, indicating that the company converted its inventory into sales nearly 5 times during the year. However, this ratio has been decreasing consistently, reaching 2.98 times in 2023.
A lower inventory turnover ratio suggests that Materion Corp is taking longer to sell its inventory, which may lead to higher carrying costs and potential obsolescence risks. This trend indicates a potential inefficiency in managing inventory levels or challenges in matching production with customer demand.
Further analysis and investigation into the underlying causes of this declining trend in inventory turnover are recommended to identify and address any operational inefficiencies or supply chain issues that may be impacting Materion Corp's inventory management processes.