Taylor Morn Home (TMHC)

Fixed asset turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Revenue	US$ in thousands	7,417,830	8,224,920	7,501,260	6,129,320	4,762,060
Property, plant and equipment	US$ in thousands	295,121	202,398	155,181	97,927	85,866
Fixed asset turnover		25.13	40.64	48.34	62.59	55.46

December 31, 2023 calculation

Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $7,417,830K ÷ $295,121K
= 25.13

The fixed asset turnover ratio for Taylor Morrison Home Corp. has seen a fluctuating trend over the past five years. The ratio was 55.46 in 2019, increased to 62.59 in 2020, and further improved to 48.34 in 2021. However, there was a significant drop to 40.64 in 2022 and a further decrease to 25.13 in 2023.

The fixed asset turnover ratio measures how efficiently the company is using its fixed assets to generate revenue. A higher ratio indicates that the company is effectively utilizing its fixed assets to generate sales. In contrast, a lower ratio may suggest inefficiencies in asset utilization.

The substantial decline in the fixed asset turnover ratio from 2021 to 2023 could indicate potential inefficiencies in asset management or declining sales relative to the value of fixed assets. It may be necessary for Taylor Morrison Home Corp. to assess its asset utilization strategies and operational efficiency to improve this particular ratio and enhance overall financial performance.