Owens Corning Inc (OC)
Fixed asset turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 9,599,000 | 9,618,000 | 8,364,000 | 6,929,000 | 7,160,000 |
| Property, plant and equipment | US$ in thousands | 3,841,000 | 3,729,000 | 3,873,000 | 3,809,000 | 3,855,000 |
| Fixed asset turnover | 2.50 | 2.58 | 2.16 | 1.82 | 1.86 |
December 31, 2023 calculation
Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $9,599,000K ÷ $3,841,000K
= 2.50
Owens Corning's fixed asset turnover ratio has fluctuated over the past five years, ranging from a low of 1.85 in 2020 to a high of 2.62 in 2022. The fixed asset turnover ratio measures how efficiently the company is utilizing its fixed assets to generate revenue. A higher ratio indicates better efficiency in generating sales from its fixed assets.
In 2023, the fixed asset turnover ratio decreased to 2.52, indicating a slight decline in the company's efficiency in utilizing its fixed assets to generate sales compared to the previous year. However, the ratio remains relatively high compared to previous years, suggesting that Owens Corning is still effectively using its fixed assets to generate revenue.
It is important to further analyze the reasons behind the fluctuations in the fixed asset turnover ratio to determine if there are any underlying factors impacting the company's efficiency in utilizing its fixed assets. Overall, a stable or increasing trend in the fixed asset turnover ratio would be favorable as it reflects improved efficiency and productivity in the company's operations.