Zimmer Biomet Holdings Inc (ZBH)

Fixed asset turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Revenue	US$ in thousands	7,171,400	6,780,400	7,459,000	6,789,700	7,751,900
Property, plant and equipment	US$ in thousands	2,060,400	1,872,500	1,836,600	2,047,700	2,077,400
Fixed asset turnover		3.48	3.62	4.06	3.32	3.73

December 31, 2023 calculation

Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $7,171,400K ÷ $2,060,400K
= 3.48

Zimmer Biomet Holdings Inc's fixed asset turnover has shown some fluctuations over the past five years. The ratio decreased from 3.84 in 2019 to 3.43 in 2020, indicating a lower efficiency in generating sales from fixed assets. However, there was an improvement in 2021 with the ratio increasing to 3.89, suggesting better utilization of fixed assets to generate revenue.

In the most recent years, the fixed asset turnover continued to decrease slightly, standing at 3.71 in 2022 and 3.59 in 2023. While the ratio remains relatively high, the slight downward trend may indicate a need for the company to further optimize its fixed asset management to enhance efficiency in generating revenue. A high fixed asset turnover ratio generally signifies effective utilization of assets to drive sales, but a consistent downward trend could warrant closer attention to ensure the company is maximizing its asset efficiency for sustainable growth.