Otter Tail Corporation (OTTR)

Inventory turnover

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Cost of revenue (ttm)	US$ in thousands	518,479	446,306	469,701	502,579	543,959	574,607	570,215	542,402	390,348	261,021	127,905	5,799	5,153	5,355	5,606	6,729	5,919	14,243	14,395	13,714
Inventory	US$ in thousands	149,701	142,007	144,441	144,767	145,952	146,376	146,964	145,857	148,490	114,615	103,024	92,426	92,165	81,871	89,754	98,152	97,851	97,052	105,860	106,732
Inventory turnover		3.46	3.14	3.25	3.47	3.73	3.93	3.88	3.72	2.63	2.28	1.24	0.06	0.06	0.07	0.06	0.07	0.06	0.15	0.14	0.13

December 31, 2023 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $518,479K ÷ $149,701K
= 3.46

The inventory turnover ratio of Otter Tail Corporation has shown a decreasing trend over the past two years. From Q1 2022 to Q4 2023, the ratio has decreased from 4.79 to 3.96, indicating that the company is taking longer to sell its inventory. This suggests that either the company is experiencing slower sales or has been accumulating inventory at a faster rate than it can sell.

A lower inventory turnover ratio can also indicate potential inefficiencies in inventory management, such as overstocking or obsolete inventory. It is important for the company to monitor and address the factors contributing to this decline in inventory turnover to optimize its working capital and profitability.