NewJersey Resources Corporation (NJR)

Fixed asset turnover

		Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020	Sep 30, 2019
Revenue	US$ in thousands	2,674,370	4,515,980	3,389,420	2,991,430	2,543,480
Property, plant and equipment	US$ in thousands	941,590	911,148	706,706	803,137	3,041,170
Fixed asset turnover		2.84	4.96	4.80	3.72	0.84

September 30, 2023 calculation

Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $2,674,370K ÷ $941,590K
= 2.84

The fixed asset turnover ratio measures how efficiently a company is using its fixed assets to generate revenue. A higher ratio indicates better utilization of fixed assets.

Looking at the trend of New Jersey Resources Corporation's fixed asset turnover ratio over the past five years, the ratio decreased from 0.85 in 2019 to 0.39 in 2023. This decline suggests a decrease in the company's ability to generate sales from its fixed assets.

The decreasing trend indicates that the company may be underutilizing its fixed assets, which could be a cause for concern. It may be worth investigating the reasons behind this decline and exploring ways to improve the productivity of fixed assets to enhance revenue generation.