Steel Dynamics Inc (STLD)

Fixed asset turnover

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Revenue (ttm)	US$ in thousands	18,718,840	19,388,190	20,452,840	21,584,090	22,260,780	22,745,150	22,181,730	20,434,160	18,408,860	15,699,440	12,941,980	10,570,970	9,601,470	9,350,430	9,546,440	10,222,660	10,465,000	11,018,690	11,715,400	12,035,400
Property, plant and equipment	US$ in thousands	6,734,220	6,313,370	5,783,620	5,491,200	5,373,660	5,146,610	4,886,560	4,827,960	4,751,430	4,654,190	4,526,890	4,340,410	4,105,570	3,862,380	3,587,450	3,327,600	3,135,890	3,031,730	2,947,240	2,936,890
Fixed asset turnover		2.78	3.07	3.54	3.93	4.14	4.42	4.54	4.23	3.87	3.37	2.86	2.44	2.34	2.42	2.66	3.07	3.34	3.63	3.98	4.10

December 31, 2023 calculation

Fixed asset turnover = Revenue (ttm) ÷ Property, plant and equipment
= $18,718,840K ÷ $6,734,220K
= 2.78

The fixed asset turnover ratio for Steel Dynamics Inc. has exhibited a declining trend over the past eight quarters. The ratio decreased from 4.54 in Q2 2022 to 2.79 in Q4 2023. This indicates that the company generated $2.79 in sales for every dollar invested in fixed assets during Q4 2023.

The decreasing trend in the fixed asset turnover ratio may suggest that Steel Dynamics Inc. is becoming less efficient in utilizing its fixed assets to generate sales. This could be a cause for concern as it may indicate operational inefficiencies or underutilization of fixed assets.

Further analysis would be required to understand the specific reasons behind the decline in the fixed asset turnover ratio and to determine appropriate corrective actions. It is important for the company to closely monitor and improve this ratio to ensure optimal utilization of its fixed assets and overall operational efficiency.