Vulcan Materials Company (VMC)

Inventory turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cost of revenue	US$ in thousands	5,833,400	5,757,500	4,178,800	3,575,300	3,673,200
Inventory	US$ in thousands	615,600	579,300	521,300	448,600	458,308
Inventory turnover		9.48	9.94	8.02	7.97	8.01

December 31, 2023 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $5,833,400K ÷ $615,600K
= 9.48

The inventory turnover ratio for Vulcan Materials Co has experienced fluctuations over the past five years. The ratio was 9.48 in 2023, slightly lower than the previous year's ratio of 9.94. This indicates that the company's inventory turnover decreased, meaning that it took longer to sell and replace its inventory in 2023 compared to 2022.

Looking further back, the inventory turnover ratio was 8.02 in 2021, 7.97 in 2020, and 8.01 in 2019. These figures suggest some variability in the company's efficiency in managing its inventory levels over the years. Overall, a higher inventory turnover ratio is generally preferred as it signifies that the company is selling its inventory more quickly.

It is important for Vulcan Materials Co to closely monitor its inventory turnover ratio and work towards improving efficiency in managing its inventory levels. By doing so, the company can optimize its working capital and ensure a healthy balance between inventory levels and sales.