Sally Beauty Holdings Inc (SBH)
Total asset turnover
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 3,652,760 | 3,705,580 | 3,777,230 | 3,415,500 | 3,779,150 |
| Total assets | US$ in thousands | 2,725,250 | 2,576,870 | 2,847,130 | 2,895,150 | 2,098,450 |
| Total asset turnover | 1.34 | 1.44 | 1.33 | 1.18 | 1.80 |
September 30, 2023 calculation
Total asset turnover = Revenue ÷ Total assets
= $3,652,760K ÷ $2,725,250K
= 1.34
Sally Beauty Holdings Inc's total asset turnover ratio measures the efficiency of the company in utilizing its total assets to generate sales revenue. A decreasing trend in total asset turnover can indicate inefficiency in asset management, while an increasing trend reflects improvements in asset utilization.
Looking at the data provided, we observe fluctuations in Sally Beauty Holdings Inc's total asset turnover ratio over the past five years. In 2019, the total asset turnover ratio was at its highest at 1.85, indicating that the company generated $1.85 in sales revenue for every dollar of total assets. This high ratio suggests efficient asset utilization in generating sales.
However, there was a notable decline in the total asset turnover ratio in 2020, dropping to 1.21. This decrease may indicate a less efficient use of the company's total assets to generate sales revenue during that period. It's important to further investigate the reasons behind this decline, as it could be attributed to various factors such as changes in business operations, asset management strategies, or macroeconomic conditions.
In the subsequent years, the total asset turnover ratio showed some recovery, reaching 1.36 in 2021 and then 1.48 in 2022. This improvement suggests that the company was able to enhance its asset utilization efficiency, generating higher sales relative to its total asset base. However, in 2023, there was a slight decrease in the ratio to 1.37, indicating a small decrease in asset efficiency compared to the previous year.
In conclusion, the fluctuating trend in Sally Beauty Holdings Inc's total asset turnover ratio indicates variations in the company's ability to effectively convert its total assets into sales revenue over the years. It would be essential for the company to further analyze the underlying factors contributing to these fluctuations and continue to focus on efficient asset management and utilization to drive sales and profitability.
Peer comparison
Sep 30, 2023