Westlake Chemical Corporation (WLK)

Inventory turnover

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 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
Cost of revenue (ttm) US$ in thousands 10,185,000 10,297,000 10,208,000 10,274,000 10,329,000 10,434,000 11,085,000 11,514,000 11,721,000 11,400,000 10,257,000 9,206,000 8,283,000 7,514,000 7,127,000 6,680,000 6,481,000 6,472,000 6,517,000 6,781,000
Inventory US$ in thousands 1,697,000 1,747,000 1,684,000 1,661,000 1,622,000 1,672,000 1,671,000 1,842,000 1,866,000 2,024,000 2,021,000 1,884,000 1,407,000 1,124,000 965,000 955,000 918,000 829,000 845,000 934,000
Inventory turnover 6.00 5.89 6.06 6.19 6.37 6.24 6.63 6.25 6.28 5.63 5.08 4.89 5.89 6.69 7.39 6.99 7.06 7.81 7.71 7.26

December 31, 2024 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $10,185,000K ÷ $1,697,000K
= 6.00

The inventory turnover of Westlake Chemical Corporation shows fluctuations over the past few years. The inventory turnover ratio, which measures how efficiently the company manages its inventory by indicating the number of times inventory is sold and replaced within a specific period, has ranged from a high of 7.81 in September 2020 to a low of 4.89 in March 2022.

A generally declining trend can be observed from 2022 onwards until 2024, with the inventory turnover staying relatively consistent around 6 times per year. This could indicate potential challenges in managing inventory levels effectively or changes in sales patterns impacting the turnover rate.

It is important for Westlake Chemical Corporation to closely monitor its inventory turnover to ensure optimal inventory management, balance between carrying costs and stockouts, and overall operational efficiency. Further analysis and comparison with industry benchmarks may provide insights into areas for improvement in inventory management practices.