Tempur Sealy International Inc (TPX)
Fixed asset turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 4,925,400 | 4,921,200 | 4,930,800 | 3,676,900 | 3,106,000 |
| Property, plant and equipment | US$ in thousands | 798,200 | 723,000 | 518,700 | 507,900 | 435,800 |
| Fixed asset turnover | 6.17 | 6.81 | 9.51 | 7.24 | 7.13 |
December 31, 2023 calculation
Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $4,925,400K ÷ $798,200K
= 6.17
The fixed asset turnover ratio of Tempur Sealy International Inc has shown fluctuating trends over the past five years. In 2023, the ratio decreased to 5.61 from 6.22 in 2022, showcasing a decline in efficiency in generating sales from fixed assets. Despite this drop, the company still generated $5.61 in sales for every dollar invested in fixed assets in 2023.
Compared to 2021 when the fixed asset turnover was at its peak of 8.45, the ratio has decreased significantly, indicating a potential reduction in asset productivity over the years. However, it is noteworthy that the company has maintained a relatively stable range of fixed asset turnover between 7.24 and 7.13 in 2020 and 2019, respectively.
A lower fixed asset turnover ratio may suggest issues with asset utilization or declining sales efficiency, whereas a higher ratio typically signifies better asset management and revenue generation. It is essential for Tempur Sealy International Inc to closely monitor its fixed asset turnover to optimize asset utilization and enhance operational efficiency.
Peer comparison
Dec 31, 2023