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)
Twenty-First Century Fox Inc., short-term (operating) activity ratios (quarterly data)
Based on: 10-Q (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-K (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-K (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-Q (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-K (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-Q (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-K (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31), 10-Q (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-K (reporting date: 2014-06-30), 10-Q (reporting date: 2014-03-31), 10-Q (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30).
The analysis of the quarterly financial performance reveals several notable trends in key efficiency and operational metrics over the observed periods.
- Inventory Turnover
- The inventory turnover ratio exhibited a fluctuating pattern, initially increasing from about 5.6 to a peak near 6.8, indicating improved efficiency in inventory management during the early periods. However, from late 2015 onward, there was a noticeable decline with ratios falling to just above 5.0 by the end of 2018, suggesting a reduced rate of inventory turnover and potentially slower movement of stock.
- Receivables Turnover
- This ratio demonstrated a declining trend from an initial 5.13 down to below 4.0 towards the end of the final period, with occasional short-term recoveries. The decreasing turnover suggests increased days outstanding for receivables, indicating a slower collection process and potential concerns around credit management or customer payment behavior.
- Working Capital Turnover
- The working capital turnover ratio showed variability, with a peak above 5.5 in late 2014 followed by a sharp decline to levels around 1.2 by the end of 2018. This significant reduction implies less efficient use of working capital to generate sales, reflecting either an increase in working capital relative to sales or declining sales efficiency.
- Average Inventory Processing Period (Days)
- The average number of days required to process inventory initially decreased from 65 days to as low as 53 days, indicating improved inventory management in the early periods. However, this was followed by a gradual increase reaching approximately 72 days towards the end of the analysis, signifying slower inventory turnover and possible buildup of stock.
- Average Receivable Collection Period (Days)
- The collection period demonstrated a lengthening trend from around 71 days up to over 90 days in some subsequent quarters, with fluctuations. This suggests that on average, the company took longer to collect receivables, which could point to easing credit terms or collection inefficiencies.
- Operating Cycle (Days)
- The operating cycle, combining inventory processing and receivable collection periods, showed a general increase from roughly 136 days to highs around 167 days. This elongation of the operating cycle indicates an overall slowdown in the conversion of resources into cash, affecting liquidity and operational efficiency.
Overall, the company experienced a trend toward longer inventory holding and receivable collection periods, resulting in an extended operating cycle and decreased turnover ratios. These developments suggest challenges in asset utilization and cash flow management, warranting attention to working capital optimization strategies.
Turnover Ratios
Average No. Days
Inventory Turnover
Twenty-First Century Fox Inc., inventory turnover calculation (quarterly data)
| Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||||||
| Operating expenses | 6,005) | 4,424) | 5,047) | 4,581) | 5,760) | 4,381) | 4,185) | 4,763) | 4,912) | 3,915) | 4,227) | 4,472) | 4,757) | 3,673) | 3,786) | 4,357) | 5,366) | 5,052) | 5,635) | 5,475) | 5,551) | 4,447) | |||||||
| Inventories, net | 3,934) | 3,804) | 3,669) | 3,645) | 3,132) | 2,856) | 3,101) | 3,418) | 3,507) | 3,300) | 3,291) | 3,522) | 3,305) | 2,987) | 2,749) | 3,062) | 3,226) | 3,385) | 3,092) | 3,387) | 3,316) | 3,278) | |||||||
| Short-term Activity Ratio | |||||||||||||||||||||||||||||
| Inventory turnover1 | 5.10 | 5.21 | 5.39 | 5.19 | 6.09 | 6.39 | 5.73 | 5.21 | 5.00 | 5.26 | 5.20 | 4.74 | 5.01 | 5.75 | 6.75 | 6.67 | 6.67 | 6.41 | 6.83 | 5.94 | 5.87 | 5.62 | |||||||
| Benchmarks | |||||||||||||||||||||||||||||
| Inventory Turnover, Competitors2 | |||||||||||||||||||||||||||||
| Walt Disney Co. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 10-Q (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-K (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-K (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-Q (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-K (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-Q (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-K (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31), 10-Q (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-K (reporting date: 2014-06-30), 10-Q (reporting date: 2014-03-31), 10-Q (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30).
1 Q2 2019 Calculation
Inventory turnover
= (Operating expensesQ2 2019
+ Operating expensesQ1 2019
+ Operating expensesQ4 2018
+ Operating expensesQ3 2018)
÷ Inventories, net
= (6,005 + 4,424 + 5,047 + 4,581)
÷ 3,934 = 5.10
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals several key trends related to operating expenses, net inventories, and inventory turnover ratios over the observed periods.
- Operating Expenses
- Operating expenses exhibit notable fluctuations throughout the quarters. Initially, expenses rise sharply from 4,447 million USD at the start of the period to a peak of 5,551 million USD in the December 2013 quarter. This is followed by periods of decline and recovery, with a significant reduction observed during early to mid-2015, reaching a low around 3,673 million USD in September 2015. However, expenses increase again towards the end of 2017 and peak once more at 6,005 million USD by the final quarter in 2018. The overall pattern suggests volatility with recurring peaks and troughs, indicating possibly cyclical operational activities or varying levels of investment and cost control measures over time.
- Inventories, Net
- The net inventories generally fluctuate between approximately 2,749 million USD and 3,934 million USD across the quarters. A gradual decrease is noticeable from early to mid-2015 where inventories drop from 3,062 million USD to 2,749 million USD. Subsequently, there is an upward trend from late 2015 onwards, with inventories eventually reaching their highest level of 3,934 million USD in the last quarter of 2018. This increase could signal accumulation of stock in anticipation of demand growth or slower turnover rates.
- Inventory Turnover Ratio
- The inventory turnover ratio presents a generally declining trend over the period. It starts relatively high at 5.62 and reaches its peak at 6.83 in June 2014, indicating efficient inventory management during that time. Following this peak, the ratio declines gradually with some intermittent recoveries but remains consistently below 6.0 and ends at 5.1 in the final quarter of 2018. This suggests a moderately reduced efficiency in inventory utilization, which aligns with the concurrent increase in inventory levels and fluctuating operating expenses.
In summary, the company experienced variable operating expenses and increasing net inventories towards the end of the period, accompanied by a gradual decrease in inventory turnover efficiency. These dynamics may reflect changing business conditions, operational strategies, or market demand variations impacting cost control and inventory management practices.
Receivables Turnover
Twenty-First Century Fox Inc., receivables turnover calculation (quarterly data)
| Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||||||
| Revenues | 8,499) | 7,177) | 7,941) | 7,420) | 8,037) | 7,002) | 6,748) | 7,564) | 7,682) | 6,506) | 6,646) | 7,228) | 7,375) | 6,077) | 6,205) | 6,840) | 8,055) | 7,887) | 8,424) | 8,219) | 8,163) | 7,061) | |||||||
| Receivables, net | 8,083) | 7,326) | 7,120) | 6,905) | 7,554) | 6,619) | 6,477) | 7,219) | 6,983) | 6,099) | 6,258) | 6,756) | 6,842) | 6,034) | 5,912) | 6,345) | 6,669) | 6,350) | 6,468) | 6,314) | 6,424) | 5,605) | |||||||
| Short-term Activity Ratio | |||||||||||||||||||||||||||||
| Receivables turnover1 | 3.84 | 4.17 | 4.27 | 4.23 | 3.89 | 4.38 | 4.40 | 3.93 | 4.02 | 4.55 | 4.37 | 3.98 | 3.87 | 4.50 | 4.90 | 4.92 | 4.89 | 5.15 | 4.93 | 4.86 | 4.64 | 5.13 | |||||||
| Benchmarks | |||||||||||||||||||||||||||||
| Receivables Turnover, Competitors2 | |||||||||||||||||||||||||||||
| Alphabet Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Comcast Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Meta Platforms Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Trade Desk Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Walt Disney Co. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 10-Q (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-K (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-K (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-Q (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-K (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-Q (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-K (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31), 10-Q (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-K (reporting date: 2014-06-30), 10-Q (reporting date: 2014-03-31), 10-Q (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30).
1 Q2 2019 Calculation
Receivables turnover
= (RevenuesQ2 2019
+ RevenuesQ1 2019
+ RevenuesQ4 2018
+ RevenuesQ3 2018)
÷ Receivables, net
= (8,499 + 7,177 + 7,941 + 7,420)
÷ 8,083 = 3.84
2 Click competitor name to see calculations.
- Revenue Trends
- Revenues exhibit notable fluctuations over the observed quarters. Initially, revenues increased from 7061 million US dollars in September 2013 to a peak near 8424 million US dollars in June 2014. Following this peak, a downward trend is evident, with revenues declining to approximately 6077 million US dollars in September 2015. After this trough, the revenues show a recovery phase, rising again to 8499 million US dollars by December 2018. This pattern indicates cyclical variations with periods of growth followed by contraction, and a general recovery towards the end of the period.
- Receivables, Net
- The net receivables demonstrate a general upward trajectory throughout the timeframe. Starting at 5605 million US dollars in September 2013, net receivables increased steadily to reach 8083 million US dollars by December 2018. Some minor fluctuations occur in intermediate quarters, but the overall direction is positive, indicating either lengthening collection periods or growth in credit sales relative to revenues.
- Receivables Turnover Ratio
- The receivables turnover ratio, which measures how efficiently the company collects its receivables, shows variability with a general declining trend. The ratio begins at 5.13 in September 2013 and decreases to 3.84 by December 2018. The fluctuations along the timeline include temporary increases but the downward trend suggests that over time the company’s efficiency in collecting receivables has diminished. This decline could be attributed to longer collection periods or an accumulation of receivables not being converted to cash as rapidly.
- Relationship Between Revenues, Receivables, and Turnover
- The increasing net receivables combined with a declining turnover ratio indicates a possible relaxation in credit control or slower collection processes over the periods examined. Despite revenues recovering and even exceeding prior peaks towards the end of the observed period, the slower turnover ratio points to potential challenges in cash flow management. The data suggests that while sales levels show volatility, the receivables management may have become less efficient, which could impact liquidity and working capital requirements.
Working Capital Turnover
Twenty-First Century Fox Inc., working capital turnover calculation (quarterly data)
| Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||||||
| Current assets | 34,017) | 19,128) | 19,333) | 18,661) | 17,402) | 16,998) | 16,286) | 16,738) | 15,705) | 14,921) | 14,949) | 15,620) | 14,826) | 15,193) | 17,376) | 19,049) | 20,264) | 14,950) | 15,376) | 15,649) | 16,721) | 16,543) | |||||||
| Less: Current liabilities | 7,935) | 7,802) | 8,244) | 9,099) | 8,055) | 8,176) | 7,238) | 7,456) | 6,749) | 7,422) | 7,068) | 8,276) | 7,268) | 6,992) | 7,262) | 7,490) | 7,239) | 9,158) | 8,856) | 9,715) | 9,484) | 8,913) | |||||||
| Working capital | 26,082) | 11,326) | 11,089) | 9,562) | 9,347) | 8,822) | 9,048) | 9,282) | 8,956) | 7,499) | 7,881) | 7,344) | 7,558) | 8,201) | 10,114) | 11,559) | 13,025) | 5,792) | 6,520) | 5,934) | 7,237) | 7,630) | |||||||
| Revenues | 8,499) | 7,177) | 7,941) | 7,420) | 8,037) | 7,002) | 6,748) | 7,564) | 7,682) | 6,506) | 6,646) | 7,228) | 7,375) | 6,077) | 6,205) | 6,840) | 8,055) | 7,887) | 8,424) | 8,219) | 8,163) | 7,061) | |||||||
| Short-term Activity Ratio | |||||||||||||||||||||||||||||
| Working capital turnover1 | 1.19 | 2.70 | 2.74 | 3.05 | 3.14 | 3.29 | 3.15 | 3.06 | 3.13 | 3.70 | 3.47 | 3.66 | 3.51 | 3.31 | 2.87 | 2.70 | 2.50 | 5.64 | 4.89 | 5.17 | 4.12 | 3.77 | |||||||
| Benchmarks | |||||||||||||||||||||||||||||
| Working Capital Turnover, Competitors2 | |||||||||||||||||||||||||||||
| Alphabet Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Comcast Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Meta Platforms Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Netflix Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Trade Desk Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Walt Disney Co. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 10-Q (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-K (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-K (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-Q (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-K (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-Q (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-K (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31), 10-Q (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-K (reporting date: 2014-06-30), 10-Q (reporting date: 2014-03-31), 10-Q (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30).
1 Q2 2019 Calculation
Working capital turnover
= (RevenuesQ2 2019
+ RevenuesQ1 2019
+ RevenuesQ4 2018
+ RevenuesQ3 2018)
÷ Working capital
= (8,499 + 7,177 + 7,941 + 7,420)
÷ 26,082 = 1.19
2 Click competitor name to see calculations.
The financial data reveals several notable trends across the reported quarters. Working capital exhibits fluctuations with distinct periods of increase and decrease, culminating in a significant spike at the end of the most recent quarter. Revenues demonstrate a cyclical pattern with some quarters experiencing declines followed by recoveries. The working capital turnover ratio shows a general declining trend, indicating changes in efficiency over time.
- Working Capital
- Working capital starts at a moderate level, showing some volatility throughout the periods. It initially declines from the starting point but rises sharply by the end of 2014, reaching a peak in the December 31, 2014 quarter. Subsequently, it experiences a gradual decrease until a substantial jump occurs in the final quarter of the dataset, nearly doubling compared to prior quarters.
- Revenues
- Revenues exhibit a pattern of peaks and troughs rather than a steady trend. Early in the timeline, revenue peaks in December 2013 before experiencing a downward movement over the following quarters. This decline continues into 2015, followed by intermittent recoveries and declines. Later quarters show some improvement with revenues increasing, but they generally remain within a fluctuating range without a definitive upward or downward trend.
- Working Capital Turnover
- The working capital turnover ratio generally decreases over the period. Initially, it shows high turnover, suggesting efficient utilization of working capital relative to revenues. However, this ratio declines notably after the end of 2014, reaching its lowest point at the end of 2018. This decline may reflect either an increase in working capital relative to revenues or a decrease in revenue relative to working capital, indicating reduced efficiency.
Overall, the data indicates that while revenues experience fluctuations with no sustained long-term trend, working capital management and the corresponding turnover efficiency have deteriorated toward the end of the observed period. The sharp increase in working capital during the last quarter, combined with a decrease in turnover ratio, suggests a significant shift in operational or financial management practices that warrants further investigation to understand its impact on liquidity and operational efficiency.
Average Inventory Processing Period
Twenty-First Century Fox Inc., average inventory processing period calculation (quarterly data)
| Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||||||||||||||||||||||||
| Inventory turnover | 5.10 | 5.21 | 5.39 | 5.19 | 6.09 | 6.39 | 5.73 | 5.21 | 5.00 | 5.26 | 5.20 | 4.74 | 5.01 | 5.75 | 6.75 | 6.67 | 6.67 | 6.41 | 6.83 | 5.94 | 5.87 | 5.62 | |||||||
| Short-term Activity Ratio (no. days) | |||||||||||||||||||||||||||||
| Average inventory processing period1 | 72 | 70 | 68 | 70 | 60 | 57 | 64 | 70 | 73 | 69 | 70 | 77 | 73 | 63 | 54 | 55 | 55 | 57 | 53 | 61 | 62 | 65 | |||||||
| Benchmarks (no. days) | |||||||||||||||||||||||||||||
| Average Inventory Processing Period, Competitors2 | |||||||||||||||||||||||||||||
| Walt Disney Co. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 10-Q (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-K (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-K (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-Q (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-K (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-Q (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-K (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31), 10-Q (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-K (reporting date: 2014-06-30), 10-Q (reporting date: 2014-03-31), 10-Q (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30).
1 Q2 2019 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 5.10 = 72
2 Click competitor name to see calculations.
The analysis of the inventory turnover ratio and the average inventory processing period over the examined quarters reveals distinct patterns and fluctuations.
- Inventory Turnover Ratio
- The inventory turnover ratio generally shows a moderate level of fluctuation throughout the period. It started at 5.62 and increased to a high of 6.83 in mid-2014, indicating an improvement in inventory efficiency. Following this peak, the ratio experienced a downward trend reaching around 4.74 by the first quarter of 2016, which suggests a slowdown in inventory turnover. Subsequently, this ratio fluctuated moderately between approximately 5.0 and 6.4 through 2017 and 2018, without a sustained upward or downward trajectory. This indicates some variability in how efficiently inventory was managed during these years, possibly reflecting changes in sales or inventory management strategies.
- Average Inventory Processing Period
- The average inventory processing period, measured in number of days, inversely mirrors the turnover ratio trends. It decreased from 65 days at the start to a low of 53 days in mid-2014, corresponding to the peak in turnover ratio, indicating faster inventory processing. After this period, the average days increased significantly, peaking around 77 days in early 2016, which indicates slower inventory clearance. From that point onwards, the processing period varied mostly between 54 and 73 days, showing some improvement towards the later quarters but still with notable inconsistency. Periods of longer processing times indicate less efficient inventory management or slower sales cycles during those quarters.
Overall, the data reflects periods of improved inventory efficiency mainly in 2013 and early 2014, followed by a decline in efficiency in late 2015 and early 2016. The subsequent years demonstrate volatility in inventory management effectiveness, with no clear trend toward consistent improvement or deterioration. This variability suggests operational challenges or changing market conditions impacting inventory turnover and processing times.
Average Receivable Collection Period
Twenty-First Century Fox Inc., average receivable collection period calculation (quarterly data)
| Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||||||||||||||||||||||||
| Receivables turnover | 3.84 | 4.17 | 4.27 | 4.23 | 3.89 | 4.38 | 4.40 | 3.93 | 4.02 | 4.55 | 4.37 | 3.98 | 3.87 | 4.50 | 4.90 | 4.92 | 4.89 | 5.15 | 4.93 | 4.86 | 4.64 | 5.13 | |||||||
| Short-term Activity Ratio (no. days) | |||||||||||||||||||||||||||||
| Average receivable collection period1 | 95 | 87 | 85 | 86 | 94 | 83 | 83 | 93 | 91 | 80 | 84 | 92 | 94 | 81 | 74 | 74 | 75 | 71 | 74 | 75 | 79 | 71 | |||||||
| Benchmarks (no. days) | |||||||||||||||||||||||||||||
| Average Receivable Collection Period, Competitors2 | |||||||||||||||||||||||||||||
| Alphabet Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Comcast Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Meta Platforms Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Trade Desk Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Walt Disney Co. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 10-Q (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-K (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-K (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-Q (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-K (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-Q (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-K (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31), 10-Q (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-K (reporting date: 2014-06-30), 10-Q (reporting date: 2014-03-31), 10-Q (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30).
1 Q2 2019 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 3.84 = 95
2 Click competitor name to see calculations.
- Receivables Turnover Ratio
- The receivables turnover ratio exhibits a generally declining trend over the analyzed periods. Initially, it fluctuated around a range of approximately 4.6 to 5.1 between September 2013 and September 2014, indicating relatively stable efficiency in collecting receivables during this timeframe. However, beginning in late 2014, the ratio began a downward trajectory, reaching a low point near 3.84 by December 2018. This decline suggests a reduced frequency in turning over receivables, potentially reflecting challenges in collection processes or changes in credit policies.
- Average Receivable Collection Period
- The average receivable collection period, measured in number of days, inversely correlates with the receivables turnover ratio and confirms a lengthening timeline for collecting receivables. Starting around 71 days in September 2013, this period increased to over 90 days at multiple points from late 2015 onward, peaking at 95 days by December 2018. This sustained increase over the years indicates that the company is taking longer to collect payments from customers, which may affect liquidity and cash flow.
- Overall Insights
- The data reveals a gradual deterioration in working capital efficiency related to accounts receivable over the five-year span. The reductions in turnover ratio alongside the elongation of the collection period suggest that the company’s receivables are being converted to cash at a slower rate. This trend could be the result of changes in credit terms, customer payment behaviors, or internal collection effectiveness. Management may need to investigate underlying causes and consider measures to improve receivables management to enhance cash flow stability.
Operating Cycle
Twenty-First Century Fox Inc., operating cycle calculation (quarterly data)
No. days
| Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||||||||||||||||||||||||
| Average inventory processing period | 72 | 70 | 68 | 70 | 60 | 57 | 64 | 70 | 73 | 69 | 70 | 77 | 73 | 63 | 54 | 55 | 55 | 57 | 53 | 61 | 62 | 65 | |||||||
| Average receivable collection period | 95 | 87 | 85 | 86 | 94 | 83 | 83 | 93 | 91 | 80 | 84 | 92 | 94 | 81 | 74 | 74 | 75 | 71 | 74 | 75 | 79 | 71 | |||||||
| Short-term Activity Ratio | |||||||||||||||||||||||||||||
| Operating cycle1 | 167 | 157 | 153 | 156 | 154 | 140 | 147 | 163 | 164 | 149 | 154 | 169 | 167 | 144 | 128 | 129 | 130 | 128 | 127 | 136 | 141 | 136 | |||||||
| Benchmarks | |||||||||||||||||||||||||||||
| Operating Cycle, Competitors2 | |||||||||||||||||||||||||||||
| Walt Disney Co. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 10-Q (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-K (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-K (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-Q (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-K (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-Q (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-K (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31), 10-Q (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-K (reporting date: 2014-06-30), 10-Q (reporting date: 2014-03-31), 10-Q (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30).
1 Q2 2019 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= 72 + 95 = 167
2 Click competitor name to see calculations.
- Inventory Processing Period
- The average inventory processing period demonstrates variability over the observed quarters. Initially, there is a decreasing trend from 65 days to 53 days within the 2013 to mid-2014 timeframe, indicating improvements in inventory turnover efficiency. However, starting in late 2014, the period generally increases, reaching a peak around 77 days in early 2016. Following that peak, there is a fluctuation with minor improvements and setbacks, ending at 72 days by the end of 2018. This suggests some challenges in maintaining inventory management efficiency in the latter periods.
- Receivable Collection Period
- The average receivable collection period shows a gradual upward trend over the entire span. Starting at 71 days in late 2013, there is an increase with some intermittent declines, but the overall direction moves upward to 95 days by the end of 2018. This indicates a lengthening in the time taken to collect receivables, which may affect cash flow and working capital management negatively.
- Operating Cycle
- The operating cycle, which combines the inventory processing and receivable collection periods, reflects the aggregate effect of the two components. Initially, it slightly declines from 136 days in late 2013 to about 127 days by mid-2014, aligning with improvements in inventory turnover. However, from late 2014 onward, the operating cycle extends consistently, peaking at 169 days in early 2016 and fluctuating between 140 and 167 days thereafter. By the end of 2018, the operating cycle remains elevated at 167 days. This trend signals an overall lengthening in the business’s cash conversion cycle, potentially indicating slower movement of cash through operational processes.