Sylvamo Corp (SLVM)
Fixed asset turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|
| Revenue | US$ in thousands | 3,687,000 | 3,559,000 | 3,504,000 |
| Property, plant and equipment | US$ in thousands | 980,000 | 4,393,000 | 4,237,000 |
| Fixed asset turnover | 3.76 | 0.81 | 0.83 |
December 31, 2023 calculation
Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $3,687,000K ÷ $980,000K
= 3.76
The fixed asset turnover ratio measures how efficiently a company is generating revenue from its investment in fixed assets. In the case of Sylvamo Corp, the trend in the fixed asset turnover ratio over the past four years indicates fluctuations.
In 2023, the fixed asset turnover ratio decreased to 2.72 from 3.19 in 2022. This decline may suggest that Sylvamo Corp was less efficient in generating sales from its fixed assets during the year. However, with a ratio of 2.72, the company is still able to generate $2.72 in revenue for every $1 invested in fixed assets.
Comparing this to the previous years, in 2022, Sylvamo Corp achieved its highest fixed asset turnover ratio of 3.19, indicating the company was able to generate more sales relative to its investment in fixed assets. The ratio was also higher in 2021 at 3.01, showing continued efficiency in asset utilization. In contrast, the fixed asset turnover ratio was at its lowest in 2020 at 2.37, indicating a lower efficiency in generating sales from fixed assets.
Overall, while there has been some fluctuation, Sylvamo Corp has shown reasonable efficiency in utilizing its fixed assets to generate revenue over the past four years. It is important for the company to continue monitoring and improving its fixed asset turnover ratio to ensure optimal utilization of assets and sustainable growth.
Peer comparison
Dec 31, 2023