Honeywell International Inc. (HON) | Short-term (Operating) Activity

Ratios (Summary)

Honeywell International Inc., short-term (operating) activity ratios

	Dec 31, 2012	Dec 31, 2011	Dec 31, 2010	Dec 31, 2009	Dec 31, 2008
Turnover Ratios
Inventory turnover	8.89	8.57	8.43	8.97	9.50
Receivables turnover	5.07	5.05	4.72	4.93	5.96
Payables turnover	7.95	7.71	7.68	8.51	9.69
Working capital turnover	8.27	9.47	10.13	11.08	37.53
Average No. of Days
Average inventory processing period	41	43	43	41	38
Add: Average receivable collection period	72	72	77	74	61
Operating cycle	113	115	121	115	100
Less: Average payables payment period	46	47	48	43	38
Cash conversion cycle	67	67	73	72	62

Source: Based on data from Honeywell International Inc. Annual Reports

Ratio	Description	The company
Inventory turnover	An activity ratio calculated as revenue divided by inventory.	Honeywell International Inc.'s inventory turnover improved from 2010 to 2011 and from 2011 to 2012.
Receivables turnover	An activity ratio equal to revenue divided by receivables.	Honeywell International Inc.'s receivables turnover improved from 2010 to 2011 and from 2011 to 2012.
Payables turnover	An activity ratio calculated as revenue divided by payables.	Honeywell International Inc.'s payables turnover increased from 2010 to 2011 and from 2011 to 2012.
Working capital turnover	An activity ratio calculated as revenue divided by working capital.	Honeywell International Inc.'s working capital turnover deteriorated from 2010 to 2011 and from 2011 to 2012.
Average inventory processing period	An activity ratio equal to the number of days in the period divided by inventory turnover over the period.	Honeywell International Inc.'s average inventory processing period improved from 2010 to 2011 and from 2011 to 2012.
Average receivable collection period	An activity ratio equal to the number of days in the period divided by receivables turnoverd.	Honeywell International Inc.'s average receivable collection period improved from 2010 to 2011 and from 2011 to 2012.
Operating cycle	Equal to average inventory processing period plus average receivables collection period.	Honeywell International Inc.'s operating cycle improved from 2010 to 2011 and from 2011 to 2012.
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.	Honeywell International Inc.'s average payables payment period declined from 2010 to 2011 and from 2011 to 2012.
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.	Honeywell International Inc.'s cash conversion cycle improved from 2010 to 2011 and from 2011 to 2012.

Inventory Turnover

	Dec 31, 2012	Dec 31, 2011	Dec 31, 2010	Dec 31, 2009	Dec 31, 2008
Selected Financial Data (USD $ in millions)
Net sales	37,665	36,529	33,370	30,908	36,556
Inventories	4,235	4,264	3,958	3,446	3,848
Inventory Turnover, Comparison to Industry
Honeywell International Inc.¹	8.89	8.57	8.43	8.97	9.50
Industry, Industrials	5.68	5.91	6.54	7.40	7.51

Source: Based on data from Honeywell International Inc. Annual Reports

2012 Calculations

¹ Inventory turnover = Net sales ÷ Inventories
= 37,665 ÷ 4,235 = 8.89

Ratio	Description	The company
Inventory turnover	An activity ratio calculated as revenue divided by inventory.	Honeywell International Inc.'s inventory turnover improved from 2010 to 2011 and from 2011 to 2012.

Receivables Turnover

	Dec 31, 2012	Dec 31, 2011	Dec 31, 2010	Dec 31, 2009	Dec 31, 2008
Selected Financial Data (USD $ in millions)
Net sales	37,665	36,529	33,370	30,908	36,556
Accounts, notes and other receivables	7,429	7,228	7,068	6,274	6,129
Receivables Turnover, Comparison to Industry
Honeywell International Inc.¹	5.07	5.05	4.72	4.93	5.96
Industry, Industrials	6.86	6.58	6.61	6.97	6.61

Source: Based on data from Honeywell International Inc. Annual Reports

2012 Calculations

¹ Receivables turnover = Net sales ÷ Accounts, notes and other receivables
= 37,665 ÷ 7,429 = 5.07

Ratio	Description	The company
Receivables turnover	An activity ratio equal to revenue divided by receivables.	Honeywell International Inc.'s receivables turnover improved from 2010 to 2011 and from 2011 to 2012.

Payables Turnover

	Dec 31, 2012	Dec 31, 2011	Dec 31, 2010	Dec 31, 2009	Dec 31, 2008
Selected Financial Data (USD $ in millions)
Net sales	37,665	36,529	33,370	30,908	36,556
Accounts payable	4,736	4,738	4,344	3,633	3,773
Payables Turnover, Comparison to Industry
Honeywell International Inc.¹	7.95	7.71	7.68	8.51	9.69
Industry, Industrials	9.93	9.52	9.91	11.16	10.92

Source: Based on data from Honeywell International Inc. Annual Reports

2012 Calculations

¹ Payables turnover = Net sales ÷ Accounts payable
= 37,665 ÷ 4,736 = 7.95

Ratio	Description	The company
Payables turnover	An activity ratio calculated as revenue divided by payables.	Honeywell International Inc.'s payables turnover increased from 2010 to 2011 and from 2011 to 2012.

Working Capital Turnover

	Dec 31, 2012	Dec 31, 2011	Dec 31, 2010	Dec 31, 2009	Dec 31, 2008
Selected Financial Data (USD $ in millions)
Current assets	17,598	16,134	15,011	13,936	13,263
Less: Current liabilities	13,045	12,275	11,717	11,147	12,289
Working capital	4,553	3,859	3,294	2,789	974
Net sales	37,665	36,529	33,370	30,908	36,556
Working Capital Turnover, Comparison to Industry
Honeywell International Inc.¹	8.27	9.47	10.13	11.08	37.53
Industry, Industrials	8.80	10.55	8.41	11.52	31.48

Source: Based on data from Honeywell International Inc. Annual Reports

2012 Calculations

¹ Working capital turnover = Net sales ÷ Working capital
= 37,665 ÷ 4,553 = 8.27

Ratio	Description	The company
Working capital turnover	An activity ratio calculated as revenue divided by working capital.	Honeywell International Inc.'s working capital turnover deteriorated from 2010 to 2011 and from 2011 to 2012.

Average Inventory Processing Period

	Dec 31, 2012	Dec 31, 2011	Dec 31, 2010	Dec 31, 2009	Dec 31, 2008
Selected Financial Data
Inventory turnover	8.89	8.57	8.43	8.97	9.50
Average Inventory Processing Period (no. of days), Comparison to Industry
Honeywell International Inc.¹	41	43	43	41	38
Industry, Industrials	64	62	56	49	49

Source: Based on data from Honeywell International Inc. Annual Reports

2012 Calculations

¹ Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 8.89 = 41

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.	Honeywell International Inc.'s average inventory processing period improved from 2010 to 2011 and from 2011 to 2012.

Average Receivable Collection Period

	Dec 31, 2012	Dec 31, 2011	Dec 31, 2010	Dec 31, 2009	Dec 31, 2008
Selected Financial Data
Receivables turnover	5.07	5.05	4.72	4.93	5.96
Average Receivable Collection Period (no. of days), Comparison to Industry
Honeywell International Inc.¹	72	72	77	74	61
Industry, Industrials	53	55	55	52	55

Source: Based on data from Honeywell International Inc. Annual Reports

2012 Calculations

¹ Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 5.07 = 72

Ratio	Description	The company
Average receivable collection period	An activity ratio equal to the number of days in the period divided by receivables turnoverd.	Honeywell International Inc.'s average receivable collection period improved from 2010 to 2011 and from 2011 to 2012.

Operating Cycle

No. of days

	Dec 31, 2012	Dec 31, 2011	Dec 31, 2010	Dec 31, 2009	Dec 31, 2008
Selected Financial Data
Average inventory processing period	41	43	43	41	38
Average receivable collection period	72	72	77	74	61
Operating Cycle, Comparison to Industry
Honeywell International Inc.¹	113	115	121	115	100
Industry, Industrials	117	117	111	102	104

Source: Based on data from Honeywell International Inc. Annual Reports

2012 Calculations

¹ Operating cycle = Average inventory processing period + Average receivable collection period
= 41 + 72 = 113

Ratio	Description	The company
Operating cycle	Equal to average inventory processing period plus average receivables collection period.	Honeywell International Inc.'s operating cycle improved from 2010 to 2011 and from 2011 to 2012.

Average Payables Payment Period

	Dec 31, 2012	Dec 31, 2011	Dec 31, 2010	Dec 31, 2009	Dec 31, 2008
Selected Financial Data
Payables turnover	7.95	7.71	7.68	8.51	9.69
Average Payables Payment Period (no. of days), Comparison to Industry
Honeywell International Inc.¹	46	47	48	43	38
Industry, Industrials	37	38	37	33	33

Source: Based on data from Honeywell International Inc. Annual Reports

2012 Calculations

¹ Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 7.95 = 46

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.	Honeywell International Inc.'s average payables payment period declined from 2010 to 2011 and from 2011 to 2012.

Cash Conversion Cycle

No. of days

	Dec 31, 2012	Dec 31, 2011	Dec 31, 2010	Dec 31, 2009	Dec 31, 2008
Selected Financial Data
Average inventory processing period	41	43	43	41	38
Average receivable collection period	72	72	77	74	61
Average payables payment period	46	47	48	43	38
Cash Conversion Cycle, Comparison to Industry
Honeywell International Inc.¹	67	67	73	72	62
Industry, Industrials	81	79	74	69	70

Source: Based on data from Honeywell International Inc. Annual Reports

2012 Calculations

¹ Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 41 + 72 – 46 = 67

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.	Honeywell International Inc.'s cash conversion cycle improved from 2010 to 2011 and from 2011 to 2012.