Ratios (Summary)

Colgate-Palmolive Co., short-term (operating) activity ratios

 
Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011 Dec 31, 2010
Turnover Ratios
Inventory turnover 5.19 5.07 5.24 5.38 5.20
Receivables turnover 11.13 10.65 10.24 9.99 9.67
Payables turnover 5.82 5.38 5.54 5.74 5.46
Working capital turnover 18.84 49.49 20.84 24.39 7,782.00
Average No. of Days
Average inventory processing period 70 72 70 68 70
Add: Average receivable collection period 33 34 36 37 38
Operating cycle 103 106 106 105 108
Less: Average payables payment period 63 68 66 64 67
Cash conversion cycle 40 38 40 41 41

Source: Based on data from Colgate-Palmolive Co. Annual Reports

Ratio Description The company
Inventory turnover An activity ratio calculated as cost of goods sold divided by inventory. Colgate-Palmolive Co.'s inventory turnover deteriorated from 2012 to 2013 but then improved from 2013 to 2014 not reaching 2012 level.
Receivables turnover An activity ratio equal to revenue divided by receivables. Colgate-Palmolive Co.'s receivables turnover improved from 2012 to 2013 and from 2013 to 2014.
Payables turnover An activity ratio calculated as cost of goods sold divided by payables. Colgate-Palmolive Co.'s payables turnover declined from 2012 to 2013 but then increased from 2013 to 2014 exceeding 2012 level.
Working capital turnover An activity ratio calculated as revenue divided by working capital. Colgate-Palmolive Co.'s working capital turnover improved from 2012 to 2013 but then deteriorated significantly from 2013 to 2014.
Average inventory processing period An activity ratio equal to the number of days in the period divided by inventory turnover over the period.
Average receivable collection period An activity ratio equal to the number of days in the period divided by receivables turnoverd. Colgate-Palmolive Co.'s average receivable collection period improved from 2012 to 2013 and from 2013 to 2014.
Operating cycle Equal to average inventory processing period plus average receivables collection period.
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. Colgate-Palmolive Co.'s average payables payment period increased from 2012 to 2013 but then declined significantly from 2013 to 2014.
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.

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Inventory Turnover

Colgate-Palmolive Co., inventory turnover calculation, comparison to benchmarks

 
Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011 Dec 31, 2010
Selected Financial Data (USD $ in millions)
Cost of sales 7,168  7,219  7,153  7,144  6,360 
Inventories 1,382  1,425  1,365  1,327  1,222 
Ratio
Inventory turnover1 5.19 5.07 5.24 5.38 5.20
Benchmarks
Inventory Turnover, Competitors
Kimberly-Clark Corp. 6.89 6.23 6.10 6.24 5.56
Procter & Gamble Co. 6.28 6.14 6.31 5.52 5.94
Inventory Turnover, Sector
Personal Products 6.25 6.01 6.12 5.66 5.76
Inventory Turnover, Industry
Consumer Goods 8.09 7.92 7.78 8.28 8.00

Source: Based on data from Colgate-Palmolive Co. Annual Reports

2014 Calculations

1 Inventory turnover = Cost of sales ÷ Inventories
= 7,168 ÷ 1,382 = 5.19

Ratio Description The company
Inventory turnover An activity ratio calculated as cost of goods sold divided by inventory. Colgate-Palmolive Co.'s inventory turnover deteriorated from 2012 to 2013 but then improved from 2013 to 2014 not reaching 2012 level.

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Receivables Turnover

Colgate-Palmolive Co., receivables turnover calculation, comparison to benchmarks

 
Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011 Dec 31, 2010
Selected Financial Data (USD $ in millions)
Net sales 17,277  17,420  17,085  16,734  15,564 
Receivables, net of allowances 1,552  1,636  1,668  1,675  1,610 
Ratio
Receivables turnover1 11.13 10.65 10.24 9.99 9.67
Benchmarks
Receivables Turnover, Competitors
Kimberly-Clark Corp. 8.87 8.31 7.97 8.01 7.99
Procter & Gamble Co. 13.01 12.93 13.79 13.16 14.80
Receivables Turnover, Sector
Personal Products 11.82 11.48 11.74 11.39 12.13
Receivables Turnover, Industry
Consumer Goods 13.54 13.11 11.63 13.20 12.28

Source: Based on data from Colgate-Palmolive Co. Annual Reports

2014 Calculations

1 Receivables turnover = Net sales ÷ Receivables, net of allowances
= 17,277 ÷ 1,552 = 11.13

Ratio Description The company
Receivables turnover An activity ratio equal to revenue divided by receivables. Colgate-Palmolive Co.'s receivables turnover improved from 2012 to 2013 and from 2013 to 2014.

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Payables Turnover

Colgate-Palmolive Co., payables turnover calculation, comparison to benchmarks

 
Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011 Dec 31, 2010
Selected Financial Data (USD $ in millions)
Cost of sales 7,168  7,219  7,153  7,144  6,360 
Accounts payable 1,231  1,343  1,290  1,244  1,165 
Ratio
Payables turnover1 5.82 5.38 5.54 5.74 5.46
Benchmarks
Payables Turnover, Competitors
Kimberly-Clark Corp. 4.99 5.35 5.86 6.15 5.98
Procter & Gamble Co. 5.02 4.83 5.35 5.08 5.23
Payables Turnover, Sector
Personal Products 5.09 5.00 5.48 5.37 5.41
Payables Turnover, Industry
Consumer Goods 6.81 6.71 6.37 7.15 6.72

Source: Based on data from Colgate-Palmolive Co. Annual Reports

2014 Calculations

1 Payables turnover = Cost of sales ÷ Accounts payable
= 7,168 ÷ 1,231 = 5.82

Ratio Description The company
Payables turnover An activity ratio calculated as cost of goods sold divided by payables. Colgate-Palmolive Co.'s payables turnover declined from 2012 to 2013 but then increased from 2013 to 2014 exceeding 2012 level.

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Working Capital Turnover

Colgate-Palmolive Co., working capital turnover calculation, comparison to benchmarks

 
Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011 Dec 31, 2010
Selected Financial Data (USD $ in millions)
Current assets 4,863  4,822  4,556  4,402  3,730 
Less: Current liabilities 3,946  4,470  3,736  3,716  3,728 
Working capital 917  352  820  686 
Net sales 17,277  17,420  17,085  16,734  15,564 
Ratio
Working capital turnover1 18.84 49.49 20.84 24.39 7,782.00
Benchmarks
Working Capital Turnover, Competitors
Kimberly-Clark Corp. 30.13 42.30 23.53 19.95
Procter & Gamble Co.
Working Capital Turnover, Sector
Personal Products
Working Capital Turnover, Industry
Consumer Goods 23.31 18.50 20.24 26.30 18.98

Source: Based on data from Colgate-Palmolive Co. Annual Reports

2014 Calculations

1 Working capital turnover = Net sales ÷ Working capital
= 17,277 ÷ 917 = 18.84

Ratio Description The company
Working capital turnover An activity ratio calculated as revenue divided by working capital. Colgate-Palmolive Co.'s working capital turnover improved from 2012 to 2013 but then deteriorated significantly from 2013 to 2014.

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Average Inventory Processing Period

Colgate-Palmolive Co., average inventory processing period calculation, comparison to benchmarks

 
Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011 Dec 31, 2010
Selected Financial Data
Inventory turnover 5.19 5.07 5.24 5.38 5.20
Ratio (no. of days)
Average inventory processing period1 70 72 70 68 70
Benchmarks (no. of days)
Average Inventory Processing Period, Competitors
Kimberly-Clark Corp. 53 59 60 59 66
Procter & Gamble Co. 58 59 58 66 61
Average Inventory Processing Period, Sector
Personal Products 58 61 60 64 63
Average Inventory Processing Period, Industry
Consumer Goods 45 46 47 44 46

Source: Based on data from Colgate-Palmolive Co. Annual Reports

2014 Calculations

1 Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 5.19 = 70

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.

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Average Receivable Collection Period

Colgate-Palmolive Co., average receivable collection period calculation, comparison to benchmarks

 
Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011 Dec 31, 2010
Selected Financial Data
Receivables turnover 11.13 10.65 10.24 9.99 9.67
Ratio (no. of days)
Average receivable collection period1 33 34 36 37 38
Benchmarks (no. of days)
Average Receivable Collection Period, Competitors
Kimberly-Clark Corp. 41 44 46 46 46
Procter & Gamble Co. 28 28 26 28 25
Average Receivable Collection Period, Sector
Personal Products 31 32 31 32 30
Average Receivable Collection Period, Industry
Consumer Goods 27 28 31 28 30

Source: Based on data from Colgate-Palmolive Co. Annual Reports

2014 Calculations

1 Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 11.13 = 33

Ratio Description The company
Average receivable collection period An activity ratio equal to the number of days in the period divided by receivables turnoverd. Colgate-Palmolive Co.'s average receivable collection period improved from 2012 to 2013 and from 2013 to 2014.

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Operating Cycle

Colgate-Palmolive Co., operating cycle calculation, comparison to benchmarks

No. of days

 
Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011 Dec 31, 2010
Selected Financial Data
Average inventory processing period 70 72 70 68 70
Average receivable collection period 33 34 36 37 38
Ratio
Operating cycle1 103 106 106 105 108
Benchmarks
Operating Cycle, Competitors
Kimberly-Clark Corp. 94 103 106 105 112
Procter & Gamble Co. 86 87 84 94 86
Operating Cycle, Sector
Personal Products 89 93 91 96 93
Operating Cycle, Industry
Consumer Goods 72 74 78 72 76

Source: Based on data from Colgate-Palmolive Co. Annual Reports

2014 Calculations

1 Operating cycle = Average inventory processing period + Average receivable collection period
= 70 + 33 = 103

Ratio Description The company
Operating cycle Equal to average inventory processing period plus average receivables collection period.

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Average Payables Payment Period

Colgate-Palmolive Co., average payables payment period calculation, comparison to benchmarks

 
Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011 Dec 31, 2010
Selected Financial Data
Payables turnover 5.82 5.38 5.54 5.74 5.46
Ratio (no. of days)
Average payables payment period1 63 68 66 64 67
Benchmarks (no. of days)
Average Payables Payment Period, Competitors
Kimberly-Clark Corp. 73 68 62 59 61
Procter & Gamble Co. 73 76 68 72 70
Average Payables Payment Period, Sector
Personal Products 72 73 67 68 67
Average Payables Payment Period, Industry
Consumer Goods 54 54 57 51 54

Source: Based on data from Colgate-Palmolive Co. Annual Reports

2014 Calculations

1 Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 5.82 = 63

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. Colgate-Palmolive Co.'s average payables payment period increased from 2012 to 2013 but then declined significantly from 2013 to 2014.

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Cash Conversion Cycle

Colgate-Palmolive Co., cash conversion cycle calculation, comparison to benchmarks

No. of days

 
Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011 Dec 31, 2010
Selected Financial Data
Average inventory processing period 70 72 70 68 70
Average receivable collection period 33 34 36 37 38
Average payables payment period 63 68 66 64 67
Ratio
Cash conversion cycle1 40 38 40 41 41
Benchmarks
Cash Conversion Cycle, Competitors
Kimberly-Clark Corp. 21 35 44 46 51
Procter & Gamble Co. 13 11 16 22 16
Cash Conversion Cycle, Sector
Personal Products 17 20 24 28 26
Cash Conversion Cycle, Industry
Consumer Goods 18 20 21 21 22

Source: Based on data from Colgate-Palmolive Co. Annual Reports

2014 Calculations

1 Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 70 + 33 – 63 = 40

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.

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