Charter Communications Inc. (NASDAQ:CHTR)

Receivables Turnover

The receivables turnover ratio decreased from 21.85 in 2020 to 18.42 in 2023, indicating a gradual decline in the efficiency of collecting receivables over this period. The ratio peaked in 2020 before experiencing a steady downward trend through to 2023.

Payables Turnover

The payables turnover ratio showed volatility over the analyzed years. It increased from 37.18 in 2019 to a high of 43.48 in 2021, suggesting faster payment to suppliers during that time. However, it declined sharply to 34.53 in 2022, then slightly rebounded to 35.88 in 2023, indicating a trend toward slower payment cycles in more recent years.

Average Receivable Collection Period

The average number of days to collect receivables increased from 17 days in 2020 to 20 days in 2023. This aligns with the observed decline in receivables turnover, reflecting slower collection processes over time.

Average Payables Payment Period

The average payables payment period fluctuated slightly, moving from 10 days in 2019 down to 8 days in 2021, then increasing to 11 days in 2022 and returning to 10 days in 2023. This indicates some variability in payment timing, with a shorter payment period in 2021 followed by a return to earlier levels.

Working Capital Turnover

No data was available for the working capital turnover ratio across all periods, preventing analysis of changes in operational efficiency related to working capital.

The financial data reveals several key trends over the five-year period ending in 2023. Revenues exhibit a steady upward trajectory, increasing from approximately 45.8 billion US dollars in 2019 to about 54.6 billion US dollars in 2023. This indicates consistent growth in the company’s sales or service income across the years. However, the pace of growth appears to moderate slightly in the most recent year, with the increase from 2022 to 2023 being less pronounced compared to prior years.

Accounts receivable, net of doubtful accounts, have also increased during the period. Starting at around 2.2 billion US dollars in 2019, the balance grew to nearly 3.0 billion US dollars by 2023. This rise in receivables suggests that a larger portion of the company’s revenues is tied up in amounts owed by customers, which could reflect extended credit terms, increased sales on credit, or delays in collections.

The receivables turnover ratio, which measures how efficiently the company collects its receivables, shows a declining trend. The ratio decreased from 20.55 in 2019 to 18.42 in 2023, indicating a slowing pace in the collection of outstanding accounts. This decline aligns with the increase in accounts receivable and points to a potential weakening in working capital management or changes in customer payment behavior.

Summary of observed financial trends:

1. Revenues consistently increased over the five years, reflecting ongoing business growth.

2. Accounts receivable expanded in absolute terms, potentially indicating more credit sales or slower collections.

3. The receivables turnover ratio declined, suggesting reduced efficiency in collecting receivables over time.

4. The combination of rising receivables and declining turnover ratio warrants monitoring to ensure it does not negatively impact liquidity.

The financial data shows several key trends in the operations and working capital management over the five-year period.

Operating Costs and Expenses

Operating costs and expenses have steadily increased from $29,224 million in 2019 to $33,405 million in 2023. This reflects a consistent upward trend, indicating rising expenditure year over year. The increase from 2019 to 2023 is approximately 14.3%, which may suggest expansion, inflation effects, or increased operational activities.

Accounts Payable, Trade

The accounts payable balance exhibited slight fluctuations. From $786 million in 2019, it decreased marginally to $724 million in 2021, before increasing to $952 million in 2022 and slightly decreasing to $931 million in 2023. The general pattern shows variability in payables management or changes in supplier payment terms.

Payables Turnover Ratio

The payables turnover ratio reflects the company's efficiency in paying its suppliers. It increased from 37.18 in 2019 to a peak of 43.48 in 2021, indicating a faster payment rate. However, it then declined to 34.53 in 2022, with a slight recovery to 35.88 in 2023. This suggests that after becoming more efficient in earlier years, the company slowed its payment pace in recent years, potentially optimizing cash flow or negotiating extended payment terms.

Overall, the rising operating costs indicate increasing scale or inflation pressures. The fluctuations in accounts payable and the related turnover ratio suggest a dynamic approach to managing short-term liabilities and supplier relationships over the period.

The annual financial data indicates several notable trends over the five-year period from 2019 to 2023. Revenues demonstrate a consistent upward trajectory, increasing from 45,764 million US dollars in 2019 to 54,607 million US dollars in 2023. This steady revenue growth suggests ongoing business expansion or increased sales volumes over the period, with a cumulative increase of approximately 19.3%.

In contrast, working capital figures exhibit persistent negative values throughout the period, indicating that current liabilities consistently exceed current assets. The working capital deficit has fluctuated, starting at -5,914 million US dollars in 2019 and deepening generally over the years to -9,082 million US dollars in 2023. Although there was a decrease in the magnitude of the deficit in 2020 and 2022 relative to the prior years, the overall pattern highlights a growing shortfall in liquidity as measured by working capital. This could suggest increased reliance on short-term liabilities or challenges in managing current assets effectively.

The absence of reported working capital turnover ratios prevents direct analysis of the efficiency in utilizing working capital relative to revenues or sales. However, given the substantial negative working capital balances, it is likely that the turnover ratios, if calculated, might present atypical or less favorable liquidity management performance metrics.

Overall, the data highlights a revenue growth trend accompanied by a deteriorating or persistently negative working capital position. This juxtaposition suggests that while the company is expanding its sales base, it may face liquidity management challenges that warrant further examination to ensure sustainable operational and financial health.

The financial data reveals a noticeable trend in the company's receivables management over the five-year period ending in 2023. The receivables turnover ratio demonstrates a general decline, starting from 20.55 in 2019, rising slightly to 21.85 in 2020, but then decreasing consistently to 18.42 by 2023. This downward trend suggests a gradual slowdown in the efficiency with which the company collects its receivables.

Correspondingly, the average receivable collection period shows an increase over the same timeframe. Beginning at 18 days in 2019, it decreases slightly to 17 days in 2020, but then extends to 20 days in 2022 and remains steady at that level through 2023. This increase in days outstanding aligns with the decreasing turnover ratio, indicating that customers are, on average, taking longer to pay their invoices.

Receivables Turnover Ratio

After a peak in 2020, the ratio steadily declines, indicating reduced efficiency in converting receivables into cash.

Average Receivable Collection Period

There is an overall increase in the collection period, pointing to extended credit terms or slower payments by customers.

These patterns may reflect changes in credit policy, customer payment behavior, or market conditions affecting cash flow velocity. The consistency of these trends in the last years warrants further examination to understand underlying causes and potential impacts on liquidity.

The analysis of the data indicates fluctuations in the management of payables over the five-year period under review.

Payables Turnover

This ratio generally measures how many times a company pays off its accounts payable during a period. The data shows an increase from 37.18 in 2019 to a peak of 43.48 in 2021, suggesting a faster rate of payment to suppliers during this period. However, there is a noticeable decline to 34.53 in 2022, followed by a slight recovery to 35.88 in 2023, indicating a slowdown in payment frequency compared to the earlier peak.

Average Payables Payment Period

This metric represents the average number of days taken to pay suppliers. The trend is inversely related to the payables turnover ratio. The average payment period decreased from 10 days in 2019 to 8 days in 2021, reflecting quicker payments during this timeframe. Subsequently, it increased to 11 days in 2022 and returned to 10 days in 2023. This increase in days aligns with the observed decline in the payables turnover ratio, implying a lengthening payment cycle after 2021.

Overall, the data reveals a tightening of the payment cycle through 2021, followed by a period of extended payment terms in the subsequent years. This could reflect changes in company policy, supplier negotiations, or responses to external economic factors affecting cash flow management.