SanDisk Corp (SNDK)
Fixed asset turnover
| Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | Sep 30, 2012 | Jun 30, 2012 | Mar 31, 2012 | Dec 31, 2011 | Sep 30, 2011 | Jun 30, 2011 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (ttm) | US$ in thousands | 5,598,370 | 5,564,870 | 5,756,970 | 6,051,180 | 6,447,990 | 6,627,690 | 6,620,300 | 6,498,960 | 6,341,210 | 6,170,000 | 5,983,640 | 5,631,680 | 5,187,680 | 5,052,510 | 5,087,930 | 5,230,770 | 5,573,500 | 5,662,140 | 5,412,620 | 5,230,260 |
| Property, plant and equipment | US$ in thousands | 790,402 | 817,130 | 831,064 | 804,764 | 769,933 | 724,357 | 692,362 | 650,223 | 639,653 | 655,794 | 673,219 | 674,249 | 659,222 | 665,542 | 612,633 | 512,734 | 453,032 | 344,897 | 297,216 | 271,166 |
| Fixed asset turnover | 7.08 | 6.81 | 6.93 | 7.52 | 8.37 | 9.15 | 9.56 | 9.99 | 9.91 | 9.41 | 8.89 | 8.35 | 7.87 | 7.59 | 8.31 | 10.20 | 12.30 | 16.42 | 18.21 | 19.29 |
March 31, 2016 calculation
Fixed asset turnover = Revenue (ttm) ÷ Property, plant and equipment
= $5,598,370K ÷ $790,402K
= 7.08
The fixed asset turnover ratio measures how efficiently a company is using its fixed assets to generate revenue. A higher ratio indicates that the company is generating more revenue per dollar of fixed assets.
Analyzing the fixed asset turnover trend of SanDisk Corp from June 2011 to March 2016, we can see a general declining trend in the ratio over the period. The ratio decreased from 19.29 in June 2011 to 7.08 in March 2016.
The rapid decline in the ratio suggests that SanDisk Corp's fixed assets were not being utilized as effectively to generate revenue towards the latter half of the period. This might indicate issues such as underutilization of assets, declining sales, or inefficient asset management practices.
It is essential for the company to closely monitor and potentially improve its fixed asset turnover ratio to ensure optimal utilization of assets and maximize revenue generation. This could involve reevaluating the asset base, enhancing operational efficiency, or exploring opportunities to generate higher sales from existing fixed assets.