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Li & Fung Ltd  (OTCPK:LFUGF) Inventory Turnover: 22.21 (As of Jun. 2017)

Inventory turnover measures how fast the company turns over its inventory within a year. It is calculated as Cost of Goods Sold divided by Total Inventories. Li & Fung Ltd's Cost of Goods Sold for the six months ended in Jun. 2017 was $6,441 Mil. Li & Fung Ltd's Total Inventories for the quarter that ended in Jun. 2017 was $290 Mil. Li & Fung Ltd's inventory turnover for the quarter that ended in Jun. 2017 was 22.21.

Days Inventory indicates the number of days of goods in sales that a company has in the inventory. Li & Fung Ltd's Days Inventory for the six months ended in Jun. 2017 was 8.22.

Total Inventories can be measured by Days Sales of Inventory (DSI). Li & Fung Ltd's days sales of inventory (DSI) for the six months ended in Jun. 2017 was 7.29.

Inventory-to-Revenue determines the ability of a company to manage their inventory levels. It measures the percentage of Inventories the company currently has on hand to support the current amount of Revenue. Li & Fung Ltd's Inventory-to-Revenue for the quarter that ended in Jun. 2017 was 0.04.


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

* Premium members only.

Li & Fung Ltd Annual Data

Dec07 Dec08 Dec09 Dec10 Dec11 Dec12 Dec13 Dec14 Dec15 Dec16
Inventory Turnover Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 17.57 16.48 20.54 29.47 35.13

Li & Fung Ltd Semi-Annual Data

Dec07 Jun08 Dec08 Jun09 Dec09 Jun10 Dec10 Jun11 Dec11 Jun12 Dec12 Jun13 Dec13 Jun14 Dec14 Jun15 Dec15 Jun16 Dec16 Jun17
Inventory Turnover Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 13.07 15.35 14.84 23.38 22.21

Calculation

Li & Fung Ltd's Inventory Turnover for the fiscal year that ended in Dec. 2016 is calculated as

Inventory Turnover (A: Dec. 2016 )
=Cost of Goods Sold / Total Inventories
=Cost of Goods Sold (A: Dec. 2016 ) / ((Total Inventories (A: Dec. 2015 ) + Total Inventories (A: Dec. 2016 )) / 2 )
=14820.801 / ((566.002 + 277.841) / 2 )
=14820.801 / 421.9215
=35.13

Li & Fung Ltd's Inventory Turnover for the quarter that ended in Jun. 2017 is calculated as

Inventory Turnover (Q: Jun. 2017 )
=Cost of Goods Sold / Total Inventories
=Cost of Goods Sold (Q: Jun. 2017 ) / ((Total Inventories (Q: Dec. 2016 ) + Total Inventories (Q: Jun. 2017 )) / 2 )
=6441.043 / ((277.841 + 302.246) / 2 )
=6441.043 / 290.0435
=22.21

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.


Explanation

Inventory Turnover measures how fast the company turns over its inventory within a year. A higher inventory turnover means the company has light inventory. Therefore the company spends less money on storage, write downs, and obsolete inventory. If the inventory is too light, it may affect sales because the company may not have enough to meet demand.

1. Days Inventory indicates the number of days of goods in sales that a company has in the inventory.

Li & Fung Ltd's Days Inventory for the six months ended in Jun. 2017 is calculated as:

Days Inventory =Total Inventories (Q: Jun. 2017 )/Cost of Goods Sold (Q: Jun. 2017 )*Days in Period
=290.0435/6441.043*365 / 2
=8.22

2. Total Inventories can be measured by Days Sales of Inventory (DSI).

Li & Fung Ltd's Days Sales of Inventory for the six months ended in Jun. 2017 is calculated as:

Days Sales of Inventory (DSI)=Total Inventories (Q: Jun. 2017 )/Revenue (Q: Jun. 2017 )*Days in Period
=290.0435/7263.594*365 / 2
=7.29

3. Inventory-to-Revenue determines the ability of a company to manage their inventory levels. It measures the percentage of Inventories the company currently has on hand to support the current amount of Revenue.

Li & Fung Ltd's Inventory to Revenue for the quarter that ended in Jun. 2017 is calculated as

Inventory-to-Revenue=Total Inventories (Q: Jun. 2017 ) / Revenue (Q: Jun. 2017 )
=290.0435 / 7263.594
=0.04

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.


Be Aware

Usually retailers pile up their inventories at holiday seasons to meet the stronger demand. Therefore, the inventory of a particular quarter of a year should not be used to calculate inventory turnover. An average inventory is a better indication.


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