Spire Inc (SR)

Inventory turnover

		Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020	Sep 30, 2019
Cost of revenue	US$ in thousands	286,100	264,800	35,700	171,400	20,200
Inventory	US$ in thousands	279,500	422,300	305,000	191,500	196,600
Inventory turnover		1.02	0.63	0.12	0.90	0.10

September 30, 2023 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $286,100K ÷ $279,500K
= 1.02

The inventory turnover ratio measures the efficiency of a company in managing its inventory. A higher inventory turnover generally indicates that the company is selling its inventory more quickly.

In the case of Spire Inc., the inventory turnover has shown significant improvement over the last five years. In 2023, the inventory turnover ratio stood at 4.51, demonstrating a substantial increase from the previous year's 2.19. This suggests that Spire Inc. was able to sell and replace its inventory approximately 4.51 times during the year.

The sharp improvement in inventory turnover from 2022 to 2023 indicates that the company may have become more efficient in managing its inventory, possibly through better inventory control processes, improved demand forecasting, or more effective inventory management.

However, it's notable that in 2020 and 2019, the inventory turnover ratio was recorded as 0.00, which could indicate potential issues such as obsolete inventory or a slowdown in sales. It would be important for Spire Inc. to provide further insight into the factors contributing to these low ratios in those years.

Overall, the increasing trend in inventory turnover reflects positively on Spire Inc.'s operational efficiency and inventory management in recent years.