Sonoco Products Company (SON)
Total asset turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 6,905,480 | 7,401,800 | 5,720,440 | 5,349,080 | 5,501,240 |
| Total assets | US$ in thousands | 7,191,960 | 7,052,940 | 5,073,240 | 5,277,260 | 5,126,290 |
| Total asset turnover | 0.96 | 1.05 | 1.13 | 1.01 | 1.07 |
December 31, 2023 calculation
Total asset turnover = Revenue ÷ Total assets
= $6,905,480K ÷ $7,191,960K
= 0.96
The total asset turnover ratio for Sonoco Products Co. has shown a declining trend over the past five years, falling from 1.05 in 2019 to 0.94 in 2023. This ratio indicates that for each dollar of assets the company holds, it generated $0.94 in sales revenue in 2023.
A decreasing total asset turnover ratio could suggest inefficiencies in asset utilization or declining sales relative to the size of the company's asset base. Factors such as underutilization of assets, excess inventory, or a decrease in sales could contribute to the lower ratio.
It is important for Sonoco Products Co. to monitor and improve its total asset turnover ratio to ensure optimal utilization of assets and maximize revenue generation from its asset base. Management should evaluate operational efficiency, inventory management, and sales strategies to address any underlying issues affecting this ratio.
Peer comparison
Dec 31, 2023