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)
Time Warner Inc., short-term (operating) activity ratios
Based on: 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31).
| Short-term activity ratio | Description | The company |
|---|---|---|
| Inventory turnover | An activity ratio calculated as cost of goods sold divided by inventory. | Time Warner Inc. inventory turnover ratio deteriorated from 2015 to 2016 and from 2016 to 2017. |
| Receivables turnover | An activity ratio equal to revenue divided by receivables. | Time Warner Inc. receivables turnover ratio deteriorated from 2015 to 2016 and from 2016 to 2017. |
| Payables turnover | An activity ratio calculated as cost of goods sold divided by payables. | Time Warner Inc. payables turnover ratio increased from 2015 to 2016 but then decreased significantly from 2016 to 2017. |
| Working capital turnover | An activity ratio calculated as revenue divided by working capital. | Time Warner Inc. working capital turnover ratio improved from 2015 to 2016 and from 2016 to 2017. |
| 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. | Time Warner Inc. number of days of inventory outstanding deteriorated from 2015 to 2016 and from 2016 to 2017. |
| Average receivable collection period | An activity ratio equal to the number of days in the period divided by receivables turnover. | Time Warner Inc. number of days of receivables outstanding deteriorated from 2015 to 2016 and from 2016 to 2017. |
| Operating cycle | Equal to average inventory processing period plus average receivables collection period. | Time Warner Inc. operating cycle deteriorated from 2015 to 2016 and from 2016 to 2017. |
| 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. | Time Warner Inc. number of days of payables outstanding decreased from 2015 to 2016 but then increased from 2016 to 2017 exceeding 2015 level. |
| 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. | Time Warner Inc. cash conversion cycle deteriorated from 2015 to 2016 and from 2016 to 2017. |
Inventory Turnover
Time Warner Inc., inventory turnover calculation, comparison to benchmarks
| Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | Dec 31, 2013 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Costs of revenues | 17,647) | 16,376) | 16,154) | 15,875) | 16,230) | |
| Inventories | 2,401) | 2,062) | 1,753) | 1,700) | 2,028) | |
| Short-term Activity Ratio | ||||||
| Inventory turnover1 | 7.35 | 7.94 | 9.22 | 9.34 | 8.00 | |
| Benchmarks | ||||||
| Inventory Turnover, Competitors2 | ||||||
| Walt Disney Co. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31).
1 2017 Calculation
Inventory turnover = Costs of revenues ÷ Inventories
= 17,647 ÷ 2,401 = 7.35
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. | Time Warner Inc. inventory turnover ratio deteriorated from 2015 to 2016 and from 2016 to 2017. |
Receivables Turnover
Time Warner Inc., receivables turnover calculation, comparison to benchmarks
| Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | Dec 31, 2013 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenues | 31,271) | 29,318) | 28,118) | 27,359) | 29,795) | |
| Receivables, less allowances | 9,401) | 8,699) | 7,411) | 7,720) | 7,868) | |
| Short-term Activity Ratio | ||||||
| Receivables turnover1 | 3.33 | 3.37 | 3.79 | 3.54 | 3.79 | |
| Benchmarks | ||||||
| Receivables Turnover, Competitors2 | ||||||
| Alphabet Inc. | — | — | — | — | — | |
| Comcast Corp. | — | — | — | — | — | |
| Meta Platforms Inc. | — | — | — | — | — | |
| Netflix Inc. | — | — | — | — | — | |
| Walt Disney Co. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31).
1 2017 Calculation
Receivables turnover = Revenues ÷ Receivables, less allowances
= 31,271 ÷ 9,401 = 3.33
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. | Time Warner Inc. receivables turnover ratio deteriorated from 2015 to 2016 and from 2016 to 2017. |
Payables Turnover
Time Warner Inc., payables turnover calculation, comparison to benchmarks
| Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | Dec 31, 2013 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Costs of revenues | 17,647) | 16,376) | 16,154) | 15,875) | 16,230) | |
| Accounts payable | 777) | 527) | 653) | 574) | 693) | |
| Short-term Activity Ratio | ||||||
| Payables turnover1 | 22.71 | 31.07 | 24.74 | 27.66 | 23.42 | |
| Benchmarks | ||||||
| Payables Turnover, Competitors2 | ||||||
| Alphabet Inc. | — | — | — | — | — | |
| Comcast Corp. | — | — | — | — | — | |
| Meta Platforms Inc. | — | — | — | — | — | |
| Netflix Inc. | — | — | — | — | — | |
| Walt Disney Co. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31).
1 2017 Calculation
Payables turnover = Costs of revenues ÷ Accounts payable
= 17,647 ÷ 777 = 22.71
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. | Time Warner Inc. payables turnover ratio increased from 2015 to 2016 but then decreased significantly from 2016 to 2017. |
Working Capital Turnover
Time Warner Inc., working capital turnover calculation, comparison to benchmarks
| Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | Dec 31, 2013 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current assets | 15,219) | 13,485) | 12,513) | 13,180) | 12,844) | |
| Less: Current liabilities | 14,077) | 9,703) | 8,002) | 9,204) | 8,383) | |
| Working capital | 1,142) | 3,782) | 4,511) | 3,976) | 4,461) | |
| Revenues | 31,271) | 29,318) | 28,118) | 27,359) | 29,795) | |
| Short-term Activity Ratio | ||||||
| Working capital turnover1 | 27.38 | 7.75 | 6.23 | 6.88 | 6.68 | |
| Benchmarks | ||||||
| Working Capital Turnover, Competitors2 | ||||||
| Alphabet Inc. | — | — | — | — | — | |
| Comcast Corp. | — | — | — | — | — | |
| Meta Platforms Inc. | — | — | — | — | — | |
| Netflix Inc. | — | — | — | — | — | |
| Walt Disney Co. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31).
1 2017 Calculation
Working capital turnover = Revenues ÷ Working capital
= 31,271 ÷ 1,142 = 27.38
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Working capital turnover | An activity ratio calculated as revenue divided by working capital. | Time Warner Inc. working capital turnover ratio improved from 2015 to 2016 and from 2016 to 2017. |
Average Inventory Processing Period
Time Warner Inc., average inventory processing period calculation, comparison to benchmarks
| Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | Dec 31, 2013 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Inventory turnover | 7.35 | 7.94 | 9.22 | 9.34 | 8.00 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average inventory processing period1 | 50 | 46 | 40 | 39 | 46 | |
| Benchmarks (no. days) | ||||||
| Average Inventory Processing Period, Competitors2 | ||||||
| Walt Disney Co. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31).
1 2017 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 7.35 = 50
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. | Time Warner Inc. number of days of inventory outstanding deteriorated from 2015 to 2016 and from 2016 to 2017. |
Average Receivable Collection Period
Time Warner Inc., average receivable collection period calculation, comparison to benchmarks
| Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | Dec 31, 2013 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Receivables turnover | 3.33 | 3.37 | 3.79 | 3.54 | 3.79 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average receivable collection period1 | 110 | 108 | 96 | 103 | 96 | |
| Benchmarks (no. days) | ||||||
| Average Receivable Collection Period, Competitors2 | ||||||
| Alphabet Inc. | — | — | — | — | — | |
| Comcast Corp. | — | — | — | — | — | |
| Meta Platforms Inc. | — | — | — | — | — | |
| Netflix Inc. | — | — | — | — | — | |
| Walt Disney Co. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31).
1 2017 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 3.33 = 110
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. | Time Warner Inc. number of days of receivables outstanding deteriorated from 2015 to 2016 and from 2016 to 2017. |
Operating Cycle
Time Warner Inc., operating cycle calculation, comparison to benchmarks
No. days
| Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | Dec 31, 2013 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Average inventory processing period | 50 | 46 | 40 | 39 | 46 | |
| Average receivable collection period | 110 | 108 | 96 | 103 | 96 | |
| Short-term Activity Ratio | ||||||
| Operating cycle1 | 160 | 154 | 136 | 142 | 142 | |
| Benchmarks | ||||||
| Operating Cycle, Competitors2 | ||||||
| Walt Disney Co. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31).
1 2017 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= 50 + 110 = 160
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. | Time Warner Inc. operating cycle deteriorated from 2015 to 2016 and from 2016 to 2017. |
Average Payables Payment Period
Time Warner Inc., average payables payment period calculation, comparison to benchmarks
| Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | Dec 31, 2013 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Payables turnover | 22.71 | 31.07 | 24.74 | 27.66 | 23.42 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average payables payment period1 | 16 | 12 | 15 | 13 | 16 | |
| Benchmarks (no. days) | ||||||
| Average Payables Payment Period, Competitors2 | ||||||
| Alphabet Inc. | — | — | — | — | — | |
| Comcast Corp. | — | — | — | — | — | |
| Meta Platforms Inc. | — | — | — | — | — | |
| Netflix Inc. | — | — | — | — | — | |
| Walt Disney Co. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31).
1 2017 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 22.71 = 16
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. | Time Warner Inc. number of days of payables outstanding decreased from 2015 to 2016 but then increased from 2016 to 2017 exceeding 2015 level. |
Cash Conversion Cycle
Time Warner Inc., cash conversion cycle calculation, comparison to benchmarks
No. days
| Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | Dec 31, 2013 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Average inventory processing period | 50 | 46 | 40 | 39 | 46 | |
| Average receivable collection period | 110 | 108 | 96 | 103 | 96 | |
| Average payables payment period | 16 | 12 | 15 | 13 | 16 | |
| Short-term Activity Ratio | ||||||
| Cash conversion cycle1 | 144 | 142 | 121 | 129 | 126 | |
| Benchmarks | ||||||
| Cash Conversion Cycle, Competitors2 | ||||||
| Walt Disney Co. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31).
1 2017 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 50 + 110 – 16 = 144
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. | Time Warner Inc. cash conversion cycle deteriorated from 2015 to 2016 and from 2016 to 2017. |