Xylem Inc (XYL)
Fixed asset turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 7,364,000 | 5,522,000 | 5,195,000 | 4,876,000 | 5,249,000 |
| Property, plant and equipment | US$ in thousands | 1,169,000 | 630,000 | 644,000 | 657,000 | 658,000 |
| Fixed asset turnover | 6.30 | 8.77 | 8.07 | 7.42 | 7.98 |
December 31, 2023 calculation
Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $7,364,000K ÷ $1,169,000K
= 6.30
The fixed asset turnover ratio measures a company's ability to generate sales revenue from its fixed assets. A higher turnover ratio indicates that the company is generating more sales per dollar of fixed assets.
In the case of Xylem Inc, the fixed asset turnover has shown some fluctuation over the past five years. The ratio was 7.98 in 2019, decreased to 7.42 in 2020, then increased to 8.07 in 2021, peaked at 8.77 in 2022, and then decreased to 6.30 in 2023.
The significant fluctuations in the fixed asset turnover ratio may suggest changes in the company's operational efficiency and asset utilization over the years. A downward trend in the ratio could indicate that the company is not effectively utilizing its fixed assets to generate sales, potentially signaling inefficiencies in operations or underutilization of assets. On the other hand, an upward trend may suggest improved efficiency and better utilization of fixed assets.
Further analysis and comparison with industry benchmarks or competitors would provide additional insights into Xylem Inc's performance in managing its fixed assets and generating revenue from them.
Peer comparison
Dec 31, 2023