National Fuel Gas Company (NFG)

Days of inventory on hand (DOH)

		Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020	Sep 30, 2019
Inventory turnover		6.84	7.13	3.35	4.02	1.83
DOH	days	53.38	51.16	109.08	90.70	199.15

September 30, 2023 calculation

DOH = 365 ÷ Inventory turnover
= 365 ÷ 6.84
= 53.38

National Fuel Gas Co.'s days of inventory on hand (DOH) measures the average number of days the company holds inventory before it is sold. The trend in the DOH ratio over the past five years reveals fluctuations. In 2023, the DOH was 67.98 days, a slight increase from the previous year's 67.96 days, suggesting a relatively stable inventory management. However, in 2021, the DOH surged to 185.29 days, indicating a significant increase in the time it took to convert inventory into sales. This may have been caused by overstocking or slowing sales. The improvement in 2022 and 2023 is positive, as it signifies better inventory turnover efficiency. It appears that the company successfully managed to reduce the extremely high DOH in 2021. Further investigation into the company's inventory management practices is warranted to determine the factors behind these fluctuations and their impact on the company's operations and financial performance.