Vericel Corp Ord (VCEL)

Fixed asset turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Revenue	US$ in thousands	197,516	164,365	156,184	124,179	117,850
Property, plant and equipment	US$ in thousands	41,635	15,800	13,235	7,522	6,996
Fixed asset turnover		4.74	10.40	11.80	16.51	16.85

December 31, 2023 calculation

Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $197,516K ÷ $41,635K
= 4.74

The fixed asset turnover ratio measures how efficiently Vericel Corp is utilizing its fixed assets to generate revenue. The trend analysis of the fixed asset turnover ratio over the past five years indicates a declining trend.

In 2023, the fixed asset turnover ratio decreased to 4.74 from 10.38 in 2022, which was a sharp drop. This may suggest that the company's fixed assets were not utilized as effectively in generating revenue compared to the previous year.

Furthermore, comparing the ratio to 2021 and 2020, the trend still shows a decline, indicating a potential long-term inefficiency in utilizing fixed assets to generate sales.

The substantial decrease in the fixed asset turnover ratio from 2019 to 2023 should be a point of concern for Vericel Corp, as it signals a reduced ability to generate revenue efficiently from its fixed assets over the years. Further investigation and analysis of the company's asset management and operational efficiency are necessary to address this decline and improve performance in the future.