Analysis of Short-term (Operating) Activity Ratios
Activity ratios measure how efficiently a company performs day-to-day tasks, such us the collection of receivables and management of inventory.
Short-term Activity Ratios (Summary)
Colgate-Palmolive Co., short-term (operating) activity ratios
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
| Short-term activity ratio | Description | The company |
|---|---|---|
| Inventory turnover | An activity ratio calculated as cost of goods sold divided by inventory. | Colgate-Palmolive Co. inventory turnover ratio improved from 2020 to 2021 but then deteriorated significantly from 2021 to 2022. |
| Receivables turnover | An activity ratio equal to revenue divided by receivables. | Colgate-Palmolive Co. receivables turnover ratio improved from 2020 to 2021 but then deteriorated significantly from 2021 to 2022. |
| Payables turnover | An activity ratio calculated as cost of goods sold divided by payables. | Colgate-Palmolive Co. payables turnover ratio increased from 2020 to 2021 and from 2021 to 2022. |
| Short-term activity ratio | Description | The company |
|---|---|---|
| Average inventory processing period | An activity ratio equal to the number of days in the period divided by inventory turnover over the period. | Colgate-Palmolive Co. number of days of inventory outstanding improved from 2020 to 2021 but then deteriorated significantly from 2021 to 2022. |
| Average receivable collection period | An activity ratio equal to the number of days in the period divided by receivables turnover. | Colgate-Palmolive Co. number of days of receivables outstanding improved from 2020 to 2021 but then deteriorated significantly from 2021 to 2022. |
| Operating cycle | Equal to average inventory processing period plus average receivables collection period. | Colgate-Palmolive Co. operating cycle improved from 2020 to 2021 but then deteriorated significantly from 2021 to 2022. |
| Average payables payment period | An estimate of the average number of days it takes a company to pay its suppliers; equal to the number of days in the period divided by payables turnover ratio for the period. | Colgate-Palmolive Co. number of days of payables outstanding decreased from 2020 to 2021 and from 2021 to 2022. |
| Cash conversion cycle | A financial metric that measures the length of time required for a company to convert cash invested in its operations to cash received as a result of its operations; equal to average inventory processing period plus average receivables collection period minus average payables payment period. | Colgate-Palmolive Co. cash conversion cycle improved from 2020 to 2021 but then deteriorated significantly from 2021 to 2022. |
Inventory Turnover
Colgate-Palmolive Co., inventory turnover calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Cost of sales | 7,719) | 7,046) | 6,454) | 6,368) | 6,313) | |
| Inventories | 2,074) | 1,692) | 1,673) | 1,400) | 1,250) | |
| Short-term Activity Ratio | ||||||
| Inventory turnover1 | 3.72 | 4.16 | 3.86 | 4.55 | 5.05 | |
| Benchmarks | ||||||
| Inventory Turnover, Competitors2 | ||||||
| Procter & Gamble Co. | 6.09 | 6.20 | 6.41 | 6.93 | 7.23 | |
| Inventory Turnover, Industry | ||||||
| Consumer Staples | 7.60 | 8.82 | 8.40 | 8.24 | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
Inventory turnover = Cost of sales ÷ Inventories
= 7,719 ÷ 2,074 = 3.72
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Inventory turnover | An activity ratio calculated as cost of goods sold divided by inventory. | Colgate-Palmolive Co. inventory turnover ratio improved from 2020 to 2021 but then deteriorated significantly from 2021 to 2022. |
Receivables Turnover
Colgate-Palmolive Co., receivables turnover calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net sales | 17,967) | 17,421) | 16,471) | 15,693) | 15,544) | |
| Receivables, net of allowances | 1,504) | 1,297) | 1,264) | 1,440) | 1,400) | |
| Short-term Activity Ratio | ||||||
| Receivables turnover1 | 11.95 | 13.43 | 13.03 | 10.90 | 11.10 | |
| Benchmarks | ||||||
| Receivables Turnover, Competitors2 | ||||||
| Procter & Gamble Co. | 15.59 | 16.11 | 16.98 | 13.67 | 14.26 | |
| Receivables Turnover, Industry | ||||||
| Consumer Staples | 34.89 | 38.54 | 37.27 | 34.73 | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
Receivables turnover = Net sales ÷ Receivables, net of allowances
= 17,967 ÷ 1,504 = 11.95
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Receivables turnover | An activity ratio equal to revenue divided by receivables. | Colgate-Palmolive Co. receivables turnover ratio improved from 2020 to 2021 but then deteriorated significantly from 2021 to 2022. |
Payables Turnover
Colgate-Palmolive Co., payables turnover calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Cost of sales | 7,719) | 7,046) | 6,454) | 6,368) | 6,313) | |
| Accounts payable | 1,551) | 1,479) | 1,393) | 1,237) | 1,222) | |
| Short-term Activity Ratio | ||||||
| Payables turnover1 | 4.98 | 4.76 | 4.63 | 5.15 | 5.17 | |
| Benchmarks | ||||||
| Payables Turnover, Competitors2 | ||||||
| Procter & Gamble Co. | 2.83 | 2.70 | 2.92 | 3.09 | 3.31 | |
| Payables Turnover, Industry | ||||||
| Consumer Staples | 6.51 | 6.79 | 6.85 | 6.89 | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
Payables turnover = Cost of sales ÷ Accounts payable
= 7,719 ÷ 1,551 = 4.98
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Payables turnover | An activity ratio calculated as cost of goods sold divided by payables. | Colgate-Palmolive Co. payables turnover ratio increased from 2020 to 2021 and from 2021 to 2022. |
Working Capital Turnover
Colgate-Palmolive Co., working capital turnover calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current assets | 5,113) | 4,397) | 4,338) | 4,179) | 3,793) | |
| Less: Current liabilities | 4,004) | 4,051) | 4,404) | 4,038) | 3,341) | |
| Working capital | 1,109) | 346) | (66) | 141) | 452) | |
| Net sales | 17,967) | 17,421) | 16,471) | 15,693) | 15,544) | |
| Short-term Activity Ratio | ||||||
| Working capital turnover1 | 16.20 | 50.35 | — | 111.30 | 34.39 | |
| Benchmarks | ||||||
| Working Capital Turnover, Competitors2 | ||||||
| Procter & Gamble Co. | — | — | — | — | — | |
| Working Capital Turnover, Industry | ||||||
| Consumer Staples | — | — | — | — | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
Working capital turnover = Net sales ÷ Working capital
= 17,967 ÷ 1,109 = 16.20
2 Click competitor name to see calculations.
Average Inventory Processing Period
Colgate-Palmolive Co., average inventory processing period calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Inventory turnover | 3.72 | 4.16 | 3.86 | 4.55 | 5.05 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average inventory processing period1 | 98 | 88 | 95 | 80 | 72 | |
| Benchmarks (no. days) | ||||||
| Average Inventory Processing Period, Competitors2 | ||||||
| Procter & Gamble Co. | 60 | 59 | 57 | 53 | 50 | |
| Average Inventory Processing Period, Industry | ||||||
| Consumer Staples | 48 | 41 | 43 | 44 | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 3.72 = 98
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Average inventory processing period | An activity ratio equal to the number of days in the period divided by inventory turnover over the period. | Colgate-Palmolive Co. number of days of inventory outstanding improved from 2020 to 2021 but then deteriorated significantly from 2021 to 2022. |
Average Receivable Collection Period
Colgate-Palmolive Co., average receivable collection period calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Receivables turnover | 11.95 | 13.43 | 13.03 | 10.90 | 11.10 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average receivable collection period1 | 31 | 27 | 28 | 33 | 33 | |
| Benchmarks (no. days) | ||||||
| Average Receivable Collection Period, Competitors2 | ||||||
| Procter & Gamble Co. | 23 | 23 | 21 | 27 | 26 | |
| Average Receivable Collection Period, Industry | ||||||
| Consumer Staples | 10 | 9 | 10 | 11 | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 11.95 = 31
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Average receivable collection period | An activity ratio equal to the number of days in the period divided by receivables turnover. | Colgate-Palmolive Co. number of days of receivables outstanding improved from 2020 to 2021 but then deteriorated significantly from 2021 to 2022. |
Operating Cycle
Colgate-Palmolive Co., operating cycle calculation, comparison to benchmarks
No. days
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Average inventory processing period | 98 | 88 | 95 | 80 | 72 | |
| Average receivable collection period | 31 | 27 | 28 | 33 | 33 | |
| Short-term Activity Ratio | ||||||
| Operating cycle1 | 129 | 115 | 123 | 113 | 105 | |
| Benchmarks | ||||||
| Operating Cycle, Competitors2 | ||||||
| Procter & Gamble Co. | 83 | 82 | 78 | 80 | 76 | |
| Operating Cycle, Industry | ||||||
| Consumer Staples | 58 | 50 | 53 | 55 | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= 98 + 31 = 129
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Operating cycle | Equal to average inventory processing period plus average receivables collection period. | Colgate-Palmolive Co. operating cycle improved from 2020 to 2021 but then deteriorated significantly from 2021 to 2022. |
Average Payables Payment Period
Colgate-Palmolive Co., average payables payment period calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Payables turnover | 4.98 | 4.76 | 4.63 | 5.15 | 5.17 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average payables payment period1 | 73 | 77 | 79 | 71 | 71 | |
| Benchmarks (no. days) | ||||||
| Average Payables Payment Period, Competitors2 | ||||||
| Procter & Gamble Co. | 129 | 135 | 125 | 118 | 110 | |
| Average Payables Payment Period, Industry | ||||||
| Consumer Staples | 56 | 54 | 53 | 53 | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 4.98 = 73
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Average payables payment period | An estimate of the average number of days it takes a company to pay its suppliers; equal to the number of days in the period divided by payables turnover ratio for the period. | Colgate-Palmolive Co. number of days of payables outstanding decreased from 2020 to 2021 and from 2021 to 2022. |
Cash Conversion Cycle
Colgate-Palmolive Co., cash conversion cycle calculation, comparison to benchmarks
No. days
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Average inventory processing period | 98 | 88 | 95 | 80 | 72 | |
| Average receivable collection period | 31 | 27 | 28 | 33 | 33 | |
| Average payables payment period | 73 | 77 | 79 | 71 | 71 | |
| Short-term Activity Ratio | ||||||
| Cash conversion cycle1 | 56 | 38 | 44 | 42 | 34 | |
| Benchmarks | ||||||
| Cash Conversion Cycle, Competitors2 | ||||||
| Procter & Gamble Co. | -46 | -53 | -47 | -38 | -34 | |
| Cash Conversion Cycle, Industry | ||||||
| Consumer Staples | 2 | -4 | 0 | 2 | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 98 + 31 – 73 = 56
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Cash conversion cycle | A financial metric that measures the length of time required for a company to convert cash invested in its operations to cash received as a result of its operations; equal to average inventory processing period plus average receivables collection period minus average payables payment period. | Colgate-Palmolive Co. cash conversion cycle improved from 2020 to 2021 but then deteriorated significantly from 2021 to 2022. |