Parker-Hannifin Corporation (PH)

Fixed asset turnover

		Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021	Jun 30, 2020
Revenue	US$ in thousands	19,984,900	18,807,800	15,709,500	14,233,900	13,372,200
Property, plant and equipment	US$ in thousands	2,775,150	2,865,030	2,122,760	2,266,480	2,292,740
Fixed asset turnover		7.20	6.56	7.40	6.28	5.83

June 30, 2024 calculation

Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $19,984,900K ÷ $2,775,150K
= 7.20

The fixed asset turnover ratio for Parker-Hannifin Corporation has exhibited a positive trend over the past five years. The ratio increased from 5.83 in June 2020 to 7.20 in June 2024, indicating that the company has been more efficient in generating sales revenue relative to its investment in fixed assets.

A higher fixed asset turnover ratio suggests that Parker-Hannifin is better utilizing its fixed assets to generate revenue, which is a positive sign of operational efficiency. The company has shown a consistent improvement in this ratio over the years, except for a slight dip in June 2023.

The increasing trend in fixed asset turnover indicates that Parker-Hannifin has been effectively managing its fixed assets to drive sales growth. This improvement may be attributed to either higher sales volumes or better asset utilization efficiency. It suggests that the company is achieving more revenue from its investment in fixed assets, which is a favorable indicator of operational performance and resource utilization.