Analysis of Short-term (Operating) Activity Ratios
Quarterly Data
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)
Old Dominion Freight Line Inc., short-term (operating) activity ratios (quarterly data)
Based on: 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
The analysis of the financial ratios over the reported periods reveals distinct trends in company performance regarding receivables, payables, and working capital management.
- Receivables Turnover
- This ratio shows variability over time with an initial increase from approximately 9.19 to a peak near 10.34 in late 2019, followed by some fluctuations. Notably, there is a dip during 2020 reaching a low point around 8.31 in the third quarter of 2021, after which the ratio climbs steadily to values above 10.9 by mid-2023. This suggests an improvement in the efficiency of collecting receivables toward the end of the period analyzed.
- Payables Turnover
- The payables turnover ratio exhibits significant volatility. Initially stable around the high 40s and low 50s throughout 2019, it spikes sharply in the first half of 2020 to above 70, indicating faster payment to suppliers during this time. However, from mid-2020 onward, the ratio declines and fluctuates between approximately 36 and 63, without a clear upward or downward trend. This fluctuation may reflect changing payment policies or supplier negotiation dynamics.
- Working Capital Turnover
- Working capital turnover displays a marked upward trend, especially from 2021 onward. Starting near 9.65 in early 2019, it declines through 2020, reaching lows near 4.61 at the end of that year. Subsequently, there is consistent growth, reaching a high of 26.15 by mid-2023. This indicates a significant enhancement in the efficiency with which working capital is utilized to generate revenue.
- Average Receivable Collection Period
- The average days to collect receivables decrease overall from 40 days in early 2019 to around 33 days by mid-2023. There are increases seen in 2020 and early 2021, with collection periods rising to 44 days, but this is followed by a clear improving trend, showing quicker collections toward the end of the data range.
- Average Payables Payment Period
- Payment periods to suppliers remain relatively short and stable, fluctuating mildly between 5 and 10 days. The shortest periods tend to occur around mid-2020 and early 2023, while slightly longer periods are observed in late 2021. Overall, this indicates consistent and prompt payment practices.
In summary, the company demonstrates improving efficiency in managing receivables and working capital over the longer term, despite some fluctuations in payables turnover. The shortening of the receivable collection period and the strong increase in working capital turnover particularly highlight enhanced operational effectiveness in recent periods. Payables payment remains steady and prompt, indicating good control over supplier obligations.
Turnover Ratios
Average No. Days
Receivables Turnover
Old Dominion Freight Line Inc., receivables turnover calculation (quarterly data)
| Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||||||
| Revenue from operations | 1,413,189) | 1,442,136) | 1,491,659) | 1,603,690) | 1,667,448) | 1,497,280) | 1,410,358) | 1,400,046) | 1,319,409) | 1,126,515) | 1,073,389) | 1,058,166) | 896,210) | 987,364) | 1,009,206) | 1,048,457) | 1,060,666) | 990,782) | ||||||
| Customer receivables, less allowances | 543,767) | 564,490) | 578,648) | 630,370) | 680,096) | 669,042) | 567,474) | 591,783) | 548,749) | 496,125) | 444,653) | 453,346) | 387,260) | 419,128) | 397,579) | 425,850) | 449,984) | 447,242) | ||||||
| Short-term Activity Ratio | ||||||||||||||||||||||||
| Receivables turnover1 | 10.94 | 10.99 | 10.82 | 9.80 | 8.79 | 8.41 | 9.26 | 8.31 | 8.34 | 8.37 | 9.03 | 8.72 | 10.18 | 9.80 | 10.34 | 9.69 | 9.19 | 9.19 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Receivables Turnover, Competitors2 | ||||||||||||||||||||||||
| FedEx Corp. | 8.08 | 8.57 | 7.88 | 7.86 | 7.34 | 7.79 | 6.96 | 6.86 | 6.55 | 6.80 | — | — | — | — | — | — | — | — | ||||||
| Uber Technologies Inc. | 13.59 | 13.16 | 11.47 | 11.77 | 10.39 | 8.65 | 7.16 | 11.13 | 10.67 | 10.04 | — | — | — | — | — | — | — | — | ||||||
| Union Pacific Corp. | 13.56 | 12.82 | 13.15 | 11.90 | 11.42 | 11.57 | 12.66 | 12.63 | 12.34 | 11.99 | — | — | — | — | — | — | — | — | ||||||
| United Airlines Holdings Inc. | 25.39 | 21.47 | 24.96 | 20.03 | 16.07 | 14.05 | 14.81 | 11.62 | 8.14 | 7.63 | — | — | — | — | — | — | — | — | ||||||
| United Parcel Service Inc. | 10.03 | 9.60 | 7.97 | 9.21 | 8.78 | 8.82 | 7.76 | 9.01 | 9.12 | 8.84 | — | — | — | — | — | — | — | — | ||||||
Based on: 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q2 2023 Calculation
Receivables turnover
= (Revenue from operationsQ2 2023
+ Revenue from operationsQ1 2023
+ Revenue from operationsQ4 2022
+ Revenue from operationsQ3 2022)
÷ Customer receivables, less allowances
= (1,413,189 + 1,442,136 + 1,491,659 + 1,603,690)
÷ 543,767 = 10.94
2 Click competitor name to see calculations.
- Revenue from Operations
- The revenue exhibits moderate fluctuations over the observed periods. In 2019, revenue started at approximately $991 million in Q1, peaked slightly above $1.06 billion in Q2, then mildly declined by the year-end to around $1.01 billion. The first half of 2020 saw a decline, dipping below $900 million in Q2, likely influenced by external economic conditions. However, the subsequent quarters in 2020 showed recovery, culminating near $1.07 billion in Q4.
- From 2021 onward, revenue demonstrated a consistent upward trajectory, rising from around $1.13 billion in Q1 2021 to a peak of approximately $1.67 billion in Q2 2022. This growth trend indicates strengthening operational performance. Nevertheless, the latter half of 2022 and early 2023 reveal a downward correction, with revenues retreating to about $1.41 billion by Q2 2023, reflecting possible market adjustments or seasonal effects.
- Customer Receivables, Less Allowances
- The accounts receivable balance showed some variability but generally increased over the time frame. Starting near $447 million in Q1 2019, receivables dropped slightly by the end of 2019, then reversed upward momentum during 2020, ending the year close to $445 million. This fluctuation may correspond to revenue changes and collection practices.
- The upward trend became more prominent from 2021, with receivables reaching nearly $592 million in Q3 2021 and peaking above $680 million in Q2 2022. Subsequently, the receivables balance decreased steadily, moving down to about $544 million by Q2 2023. This pattern suggests variations in credit extension or improved collection efficiency following the revenue peak period.
- Receivables Turnover Ratio
- The receivables turnover ratio exhibited moderate variation, generally declining from 9.19 in early 2019 to a low near 8.3 in the latter half of 2021. This decline indicates that the company took longer to collect receivables during this interval, potentially linked to the higher receivables levels observed.
- Beginning in late 2021 and continuing into 2023, the turnover ratio improved substantially, rising above 10 by mid-2023. This improvement suggests enhanced efficiency in collecting receivables, supporting better liquidity management despite the revenue decline in the same period.
- Overall Analysis
- The company demonstrated overall revenue growth from 2019 through mid-2022, with a subsequent decrease in revenue and receivables that may reflect external market influences or operational adjustments. The increase in receivables during peak revenue periods, accompanied by a declining turnover ratio, points to extended collection times, whereas the later improvements in turnover ratio indicate stronger receivables management efforts.
Payables Turnover
Old Dominion Freight Line Inc., payables turnover calculation (quarterly data)
| Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||||||
| Revenue from operations | 1,413,189) | 1,442,136) | 1,491,659) | 1,603,690) | 1,667,448) | 1,497,280) | 1,410,358) | 1,400,046) | 1,319,409) | 1,126,515) | 1,073,389) | 1,058,166) | 896,210) | 987,364) | 1,009,206) | 1,048,457) | 1,060,666) | 990,782) | ||||||
| Accounts payable | 96,661) | 119,773) | 106,275) | 120,160) | 136,480) | 117,850) | 82,519) | 135,044) | 90,956) | 88,452) | 68,511) | 59,229) | 51,257) | 55,097) | 70,254) | 81,269) | 85,125) | 79,397) | ||||||
| Short-term Activity Ratio | ||||||||||||||||||||||||
| Payables turnover1 | 61.56 | 51.81 | 58.90 | 51.42 | 43.78 | 47.75 | 63.70 | 36.43 | 50.33 | 46.97 | 58.61 | 66.71 | 76.89 | 74.52 | 58.49 | 50.78 | 48.59 | 51.76 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Payables Turnover, Competitors2 | ||||||||||||||||||||||||
| FedEx Corp. | 23.59 | 22.74 | 23.20 | 21.90 | 21.37 | 22.67 | 21.86 | 19.74 | 20.02 | 21.41 | — | — | — | — | — | — | — | — | ||||||
| Uber Technologies Inc. | 30.63 | 29.34 | 27.00 | 22.55 | 18.17 | 13.53 | 10.87 | 24.80 | 15.26 | 23.16 | — | — | — | — | — | — | — | — | ||||||
| United Airlines Holdings Inc. | 12.20 | 12.65 | 13.24 | 11.53 | 9.49 | 9.77 | 9.62 | 9.03 | 6.58 | 5.77 | — | — | — | — | — | — | — | — | ||||||
| United Parcel Service Inc. | 15.81 | 15.69 | 13.36 | 15.02 | 13.96 | 14.04 | 12.93 | 14.65 | 14.09 | 14.20 | — | — | — | — | — | — | — | — | ||||||
Based on: 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q2 2023 Calculation
Payables turnover
= (Revenue from operationsQ2 2023
+ Revenue from operationsQ1 2023
+ Revenue from operationsQ4 2022
+ Revenue from operationsQ3 2022)
÷ Accounts payable
= (1,413,189 + 1,442,136 + 1,491,659 + 1,603,690)
÷ 96,661 = 61.56
2 Click competitor name to see calculations.
The analysis of the financial data over the reported periods reveals notable trends regarding revenue from operations, accounts payable, and payables turnover ratios.
- Revenue from Operations
- The revenue figures show fluctuations throughout the periods. Initially, revenue increased from approximately 991 million US dollars in the first quarter of 2019 to just over 1.06 billion in the second quarter of 2019, followed by a slight dip and stabilization around one billion dollars until early 2020. Starting in the second quarter of 2020, revenue experienced a marked increase, peaking in the third quarter of 2021 at about 1.4 billion dollars. The firm sustained high revenue levels through 2022, reaching a maximum slightly above 1.66 billion in the second quarter of 2022. However, thereafter, revenue demonstrated a gradual decreasing pattern with figures descending to approximately 1.41 billion by the second quarter of 2023. Overall, the trend suggests growth acceleration through 2021 and early 2022, followed by a moderate decline in the most recent quarters.
- Accounts Payable
- Accounts payable amounts showed a varied pattern across the quarters. Values started near 79 million US dollars in early 2019 and generally fluctuated around this range through 2019, but declined in the first half of 2020 to below 55 million. Entering the second half of 2020 through to 2021, accounts payable increased substantially, peaking at roughly 135 million in the third quarter of 2021. This peak was followed by some volatility but remained elevated relative to the earlier periods, with values oscillating between approximately 82 million and 136 million through 2022. In 2023, payables displayed a downward trajectory, falling to around 97 million by the second quarter. The pattern indicates heightened payables during 2021 and 2022, which may reflect changes in operational or purchasing activities.
- Payables Turnover Ratio
- The payables turnover ratio exhibited significant variability across the reported periods. Early periods in 2019 featured higher ratios, ranging mostly between 48 and 58, peaking at 58.49 in December 2019. In the initial half of 2020, ratios spiked considerably to over 74 and 76, signaling faster payment cycles during that time. This was followed by a decline and irregular movement through 2020 and 2021, with turnover ratios reaching a low of 36.43 in the third quarter of 2021, then sharply increasing to 63.7 in the subsequent quarter. From 2022 onwards, the payables turnover ratio remained relatively moderate, generally between 43 and 61, displaying neither a clear upward nor downward trend but notable fluctuations. These variations may reflect adjustments in payment policies, changes in supplier terms, or cash flow management strategies throughout the observed timeline.
In summary, revenue demonstrated strong growth peaks followed by a recent slowdown, accounts payable increased notably in 2021-2022 before declining, and the payables turnover ratio showed considerable fluctuations indicative of changing payment dynamics. Together, these trends suggest a period of operational expansion with increased purchasing activity, accompanied by evolving payables management practices.
Working Capital Turnover
Old Dominion Freight Line Inc., working capital turnover calculation (quarterly data)
| Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||||||
| Current assets | 730,609) | 896,950) | 933,740) | 1,111,197) | 1,209,090) | 1,280,957) | 1,383,787) | 1,278,852) | 1,311,115) | 1,223,261) | 1,243,339) | 1,138,496) | 968,570) | 831,006) | 866,834) | 806,978) | 741,420) | 783,878) | ||||||
| Less: Current liabilities | 503,018) | 569,520) | 529,793) | 639,327) | 628,178) | 578,596) | 464,234) | 534,291) | 482,018) | 513,862) | 373,130) | 449,288) | 494,174) | 428,295) | 366,085) | 396,862) | 386,105) | 358,155) | ||||||
| Working capital | 227,591) | 327,430) | 403,947) | 471,870) | 580,912) | 702,361) | 919,553) | 744,561) | 829,097) | 709,399) | 870,209) | 689,208) | 474,396) | 402,711) | 500,749) | 410,116) | 355,315) | 425,723) | ||||||
| Revenue from operations | 1,413,189) | 1,442,136) | 1,491,659) | 1,603,690) | 1,667,448) | 1,497,280) | 1,410,358) | 1,400,046) | 1,319,409) | 1,126,515) | 1,073,389) | 1,058,166) | 896,210) | 987,364) | 1,009,206) | 1,048,457) | 1,060,666) | 990,782) | ||||||
| Short-term Activity Ratio | ||||||||||||||||||||||||
| Working capital turnover1 | 26.15 | 18.95 | 15.50 | 13.09 | 10.29 | 8.01 | 5.72 | 6.61 | 5.52 | 5.86 | 4.61 | 5.73 | 8.31 | 10.20 | 8.21 | 10.06 | 11.64 | 9.65 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Working Capital Turnover, Competitors2 | ||||||||||||||||||||||||
| FedEx Corp. | 22.52 | 16.22 | 15.35 | 16.74 | 13.05 | 13.06 | 12.13 | 9.67 | 8.17 | 9.27 | — | — | — | — | — | — | — | — | ||||||
| Uber Technologies Inc. | 17.25 | 65.98 | 80.50 | 83.47 | — | 1,646.62 | — | 9.53 | 129.39 | 10.72 | — | — | — | — | — | — | — | — | ||||||
| Union Pacific Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| United Airlines Holdings Inc. | — | — | 681.14 | 58.21 | 38.43 | 35.17 | 6.98 | 3.24 | 2.21 | 5.72 | — | — | — | — | — | — | — | — | ||||||
| United Parcel Service Inc. | 20.23 | 18.10 | 24.61 | 14.61 | 12.16 | 11.27 | 13.21 | 12.81 | 14.87 | 19.13 | — | — | — | — | — | — | — | — | ||||||
Based on: 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q2 2023 Calculation
Working capital turnover
= (Revenue from operationsQ2 2023
+ Revenue from operationsQ1 2023
+ Revenue from operationsQ4 2022
+ Revenue from operationsQ3 2022)
÷ Working capital
= (1,413,189 + 1,442,136 + 1,491,659 + 1,603,690)
÷ 227,591 = 26.15
2 Click competitor name to see calculations.
- Working Capital
- The working capital exhibited considerable fluctuations over the analyzed periods. Initially, it decreased from 425,723 thousand USD in March 2019 to 355,315 thousand USD by June 2019, before recovering to 500,749 thousand USD by December 2019. In 2020, working capital showed an upward trend, peaking at 870,209 thousand USD in December, indicating improved liquidity. However, from 2021 onwards, there was a consistent decline, dropping from 709,399 thousand USD in March 2021 to 227,591 thousand USD by June 2023, which suggests tightening working capital or increased use of short-term financing.
- Revenue from Operations
- The revenue from operations largely maintained a positive trend, showing growth in most quarters. From March 2019's 990,782 thousand USD, revenue fluctuated but generally increased, reaching a high of 1,667,448 thousand USD in June 2022. Despite some quarters showing slight declines, revenue remained strong, with figures around 1.4 to 1.6 million USD in the most recent quarters, indicating sustained operational activity and demand despite working capital reductions.
- Working Capital Turnover
- The working capital turnover ratio revealed an increasing trend, signifying improved efficiency in utilizing working capital to generate revenue. Starting at 9.65 in March 2019, it dipped to 4.61 in December 2020, coinciding with the highest working capital levels. Afterwards, the ratio experienced a marked increase, reaching 26.15 by June 2023. This suggests that even though working capital levels were declining, the company was generating more revenue per unit of working capital, possibly reflecting better asset management or more efficient operations.
- Summary Insights
- Overall, the data suggests the company improved operational efficiency as evidenced by rising working capital turnover despite a downward trend in absolute working capital values. The consistent revenue growth alongside decreasing working capital points to enhanced liquidity management and potentially stronger cash flow. However, the reduced working capital levels in recent quarters could also indicate potential constraints on short-term financial flexibility, warranting close monitoring to maintain balanced operational funding.
Average Receivable Collection Period
Old Dominion Freight Line Inc., average receivable collection period calculation (quarterly data)
| Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||||||||||||||||||||
| Receivables turnover | 10.94 | 10.99 | 10.82 | 9.80 | 8.79 | 8.41 | 9.26 | 8.31 | 8.34 | 8.37 | 9.03 | 8.72 | 10.18 | 9.80 | 10.34 | 9.69 | 9.19 | 9.19 | ||||||
| Short-term Activity Ratio (no. days) | ||||||||||||||||||||||||
| Average receivable collection period1 | 33 | 33 | 34 | 37 | 42 | 43 | 39 | 44 | 44 | 44 | 40 | 42 | 36 | 37 | 35 | 38 | 40 | 40 | ||||||
| Benchmarks (no. days) | ||||||||||||||||||||||||
| Average Receivable Collection Period, Competitors2 | ||||||||||||||||||||||||
| FedEx Corp. | 45 | 43 | 46 | 46 | 50 | 47 | 52 | 53 | 56 | 54 | — | — | — | — | — | — | — | — | ||||||
| Uber Technologies Inc. | 27 | 28 | 32 | 31 | 35 | 42 | 51 | 33 | 34 | 36 | — | — | — | — | — | — | — | — | ||||||
| Union Pacific Corp. | 27 | 28 | 28 | 31 | 32 | 32 | 29 | 29 | 30 | 30 | — | — | — | — | — | — | — | — | ||||||
| United Airlines Holdings Inc. | 14 | 17 | 15 | 18 | 23 | 26 | 25 | 31 | 45 | 48 | — | — | — | — | — | — | — | — | ||||||
| United Parcel Service Inc. | 36 | 38 | 46 | 40 | 42 | 41 | 47 | 40 | 40 | 41 | — | — | — | — | — | — | — | — | ||||||
Based on: 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q2 2023 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 10.94 = 33
2 Click competitor name to see calculations.
- Receivables Turnover Ratio
- Over the analyzed periods, the receivables turnover ratio exhibited moderate fluctuations with an overall upward trend toward the end. Initially, the ratio remained relatively stable around 9.2 from early 2019 through the first quarter of 2020. A noticeable dip occurred in the third quarter of 2020, dropping below 9.0, indicating a slower collection of receivables in that interval. However, from the fourth quarter of 2020 onward, the ratio generally improved, rising steadily and peaking at approximately 10.99 in the first half of 2023. This increase suggests enhanced efficiency in collecting receivables as the periods progressed.
- Average Receivable Collection Period
- The average receivable collection period inversely mirrored the movements of the receivables turnover ratio, as expected. Throughout 2019, the period shortened from 40 days in the first quarter to 35 days by year-end, indicative of accelerated collection processes. A slight elongation occurred during the third and fourth quarters of 2020, increasing back toward 42-44 days, aligning with the dip in turnover ratio during the same period. Subsequently, a consistent decline in the collection period was observed from late 2021 to mid-2023, reaching the low 33-day mark. This reflects improved cash conversion cycles and suggests stronger credit management.
- Summary of Insights
- The data suggest that after some volatility around 2020, the company's management has progressively optimized accounts receivable collections. The higher receivables turnover ratio accompanied by a shorter average collection period in recent quarters points to increased operational efficiency and potentially stronger liquidity positions. This trend may positively affect working capital management. Any transient deterioration around mid-2020 might be linked to external factors temporarily impacting collection efficiency.
Average Payables Payment Period
Old Dominion Freight Line Inc., average payables payment period calculation (quarterly data)
| Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||||||||||||||||||||
| Payables turnover | 61.56 | 51.81 | 58.90 | 51.42 | 43.78 | 47.75 | 63.70 | 36.43 | 50.33 | 46.97 | 58.61 | 66.71 | 76.89 | 74.52 | 58.49 | 50.78 | 48.59 | 51.76 | ||||||
| Short-term Activity Ratio (no. days) | ||||||||||||||||||||||||
| Average payables payment period1 | 6 | 7 | 6 | 7 | 8 | 8 | 6 | 10 | 7 | 8 | 6 | 5 | 5 | 5 | 6 | 7 | 8 | 7 | ||||||
| Benchmarks (no. days) | ||||||||||||||||||||||||
| Average Payables Payment Period, Competitors2 | ||||||||||||||||||||||||
| FedEx Corp. | 15 | 16 | 16 | 17 | 17 | 16 | 17 | 18 | 18 | 17 | — | — | — | — | — | — | — | — | ||||||
| Uber Technologies Inc. | 12 | 12 | 14 | 16 | 20 | 27 | 34 | 15 | 24 | 16 | — | — | — | — | — | — | — | — | ||||||
| United Airlines Holdings Inc. | 30 | 29 | 28 | 32 | 38 | 37 | 38 | 40 | 55 | 63 | — | — | — | — | — | — | — | — | ||||||
| United Parcel Service Inc. | 23 | 23 | 27 | 24 | 26 | 26 | 28 | 25 | 26 | 26 | — | — | — | — | — | — | — | — | ||||||
Based on: 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q2 2023 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 61.56 = 6
2 Click competitor name to see calculations.
The payables turnover ratio exhibits notable fluctuations over the observed quarters. Initially, the ratio hovers around the low 50s, maintaining a relatively stable trend through 2019 with values ranging from approximately 48.59 to 58.49. In 2020, a marked increase is evident, peaking near 76.89 in mid-year, suggesting an accelerated rate at which payables were being settled during this period. Subsequently, the ratio declines through the latter half of 2020 but remains elevated relative to the pre-2020 levels.
Throughout 2021, the payables turnover ratio experiences a pronounced volatility, with a steep drop to about 36.43 in the third quarter, indicating a slower payment cycle for that period, before rebounding towards 63.7 by year-end. In 2022 and early 2023, the ratio oscillates within the range of mid-40s to low 60s, implying moderate variability in payables management pace during these quarters.
The average payables payment period, expressed in days, generally moves inversely to the payables turnover ratio, as expected. Early in the timeline, the payment period remains consistent between 6 and 8 days, with a slight shortening to around 5 days during 2020, coinciding with the rise in turnover ratio. This suggests a strategic focus on faster payments during that year.
In 2021, there is an apparent elongation, peaking at 10 days in the third quarter, which corresponds with the lowest payables turnover ratio in the same quarter, reflecting delayed payment cycles. Afterward, the payment period shortens again, returning to an average of 6 to 8 days through 2022 and into 2023, indicating a normalization of payment processes.
Overall, the data indicates periods of dynamic changes in payables management with 2020 showing a tendency toward faster settlements, possibly to leverage favorable trade terms or supplier relationships. The volatility in 2021 suggests operational adjustments or external pressures impacting payment cycles. The stabilization observed towards 2022 and 2023 points to a reestablishment of a consistent payables pattern within the company’s working capital management practices.
- Payables Turnover Ratio
- Fluctuates notably from mid-40s to mid-70s across quarters, with peak turnover in 2020 indicating faster settlement of payables.
- Average Payables Payment Period
- Ranges between 5 and 10 days, inversely related to turnover ratio, with shortest periods in 2020 and a peak in mid-2021, reflecting variability in payment timing.
- Trend Insights
- Acceleration in payment cycles during 2020, followed by volatility in 2021, and eventual normalization in 2022-2023, suggesting adaptive payables management in response to operational conditions.