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.
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Short-term Activity Ratios (Summary)
Halliburton Co., short-term (operating) activity ratios (quarterly data)
Based on: 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-K (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-K (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31).
- Inventory Turnover
- The inventory turnover ratio decreased significantly from 8.74 at the end of 2015 to 6.6 by the end of 2016, indicating a slower rate of inventory being sold or used. In 2017, it fluctuated slightly but showed an upward trend towards the end of the year, reaching 7.66. In 2018, a moderate declining trend appeared, with the ratio ending at 6.94 by year-end, suggesting a gradual slowing in inventory turnover.
- Receivables Turnover
- There was a continuous decline in receivables turnover from 5.07 in March 2015 to around 3.85-3.9 in mid-2017, indicating slower collection of receivables. However, a recovery began in late 2017 and continued through 2018, with the ratio rising to 4.58 by December 2018, reflecting improved efficiency in collecting receivables.
- Payables Turnover
- The payables turnover ratio saw a sharp drop from above 10 in 2015 and early 2016 to below 7 by the end of 2016 and through 2017, indicating a slower payment to suppliers. The ratio remained relatively stable but low around 6.6 to 7 towards the end of 2018, suggesting extended payment periods compared to earlier years.
- Working Capital Turnover
- The working capital turnover declined sharply in 2015, hitting a low of 1.45 in December, before gradually improving through 2016. From 2017 onward, it demonstrated a consistent upward trend, increasing from around 2.67 to 3.78 by the end of 2018, indicating enhanced efficiency in using working capital to generate sales.
- Average Inventory Processing Period
- The average days inventory was held increased markedly from the low 40s in early 2015 to a peak near 57 days in late 2016, aligning with the drop in inventory turnover. After that, the period slightly decreased and stabilized in the high 40s to low 50s through 2017 and 2018, suggesting more stable inventory management during that time.
- Average Receivable Collection Period
- The receivable collection period lengthened from about 72 days in early 2015 to a peak of 95 days in the second half of 2017, indicating slower customer payments. Starting in late 2017 and throughout 2018, the period shortened steadily to 80 days by the end of 2018, reflecting better collection practices.
- Operating Cycle
- The operating cycle extended from around 118 days in 2015 to a high of approximately 151 days by late 2016. Following this peak, the cycle shortened gradually and stabilized around 133 to 135 days in 2018, suggesting improvements in the overall management of inventory and receivables.
- Average Payables Payment Period
- The average days payable increased consistently over the period, starting at approximately 32 days in early 2015 and rising to over 50 days by the end of 2017 and through 2018, indicating the company took longer to pay its suppliers, potentially reflecting extended payment terms or cash management strategies.
- Cash Conversion Cycle
- The cash conversion cycle, representing the net time to convert investments in inventory and receivables into cash, expanded from 86 days in March 2015 to a peak of 116 days in 2016. Afterward, it declined gradually to about 81 days by the end of 2018. This improvement indicates a reduction in the time lag between cash outflows and inflows over the later periods.
Turnover Ratios
Average No. Days
Inventory Turnover
Halliburton Co., 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 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||
| Cost of services and product sales | |||||||||||||||||||||
| Inventories | |||||||||||||||||||||
| Short-term Activity Ratio | |||||||||||||||||||||
| Inventory turnover1 | |||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||
| Inventory Turnover, Competitors2 | |||||||||||||||||||||
| SLB N.V. | |||||||||||||||||||||
Based on: 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-K (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-K (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31).
1 Q4 2018 Calculation
Inventory turnover
= (Cost of services and product salesQ4 2018
+ Cost of services and product salesQ3 2018
+ Cost of services and product salesQ2 2018
+ Cost of services and product salesQ1 2018)
÷ Inventories
= ( + + + )
÷ =
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals several noteworthy trends in the company's operational metrics over the observed periods.
- Cost of Services and Product Sales
-
This line item initially declined from 6,285 million US dollars in the first quarter of 2015 to a trough of 3,662 million US dollars in the third quarter of 2016. This represents a substantial decrease over approximately six quarters. Following this decline, there was a gradual upward trend starting from late 2016 through 2018, culminating in costs of approximately 5,269 million US dollars by the fourth quarter of 2018. However, the cost level by the end of 2018 remained below the early 2015 peak levels, indicating partial recovery.
- Inventories
-
Inventories decreased from 3,467 million US dollars at the beginning of 2015 to a low of 2,275 million US dollars in the final quarter of 2016. After this point, inventory levels broadly increased again, reaching a high of 3,028 million US dollars by the end of 2018. While this recovery reflects a rebuilding of inventory, the overall pattern indicates inventory management adjustments possibly in response to changing demand or operational strategy.
- Inventory Turnover Ratio
-
The inventory turnover ratio, which measures how frequently inventory is sold and replaced over a period, shows a decreasing trend from a ratio of 7.88 in the first quarter of 2015 to a low near 6.41 in the third quarter of 2016. This decline suggests slower movement of inventory corresponding with lower sales cost periods. Afterward, the ratio improved gradually towards the end of 2017 and early 2018, peaking at 7.89 in the first quarter of 2018, before experiencing a slight decline towards the end of 2018. The improvement in turnover ratio during this period indicates more efficient inventory use, followed by a moderate slow down toward the latter part of 2018.
Overall, the data reflects a period of contraction in costs and inventory levels through mid-2016, likely linked to reduced sales or operational scaling. Subsequently, there is evidence of recovery and operational optimization in inventory management and cost controls through 2018. The inventory turnover ratio's fluctuations align with these trends, marking periods of less and more efficient inventory usage respectively.
Receivables Turnover
Halliburton Co., 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 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||
| Revenue | |||||||||||||||||||||
| Receivables, net of allowances for bad debts | |||||||||||||||||||||
| Short-term Activity Ratio | |||||||||||||||||||||
| Receivables turnover1 | |||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||
| Receivables Turnover, Competitors2 | |||||||||||||||||||||
| SLB N.V. | |||||||||||||||||||||
Based on: 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-K (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-K (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31).
1 Q4 2018 Calculation
Receivables turnover
= (RevenueQ4 2018
+ RevenueQ3 2018
+ RevenueQ2 2018
+ RevenueQ1 2018)
÷ Receivables, net of allowances for bad debts
= ( + + + )
÷ =
2 Click competitor name to see calculations.
The financial data over the examined quarters demonstrates distinct trends in revenue, receivables, and receivables turnover ratios.
- Revenue
-
The revenue figures show a clear declining trend from the first quarter of 2015 through the end of 2016, dropping from approximately $7.05 billion to around $4.02 billion. Starting in the first quarter of 2017, there is a recovery phase where revenue progressively increases, peaking near $6.17 billion in the third quarter of 2018, before a slight decrease to about $5.94 billion in the final quarter of 2018. This pattern indicates a contraction followed by a period of growth and stabilization towards the end of the period.
- Receivables, net of allowances for bad debts
-
The net receivables steadily decreased from $6.42 billion in the first quarter of 2015 to a low of approximately $3.92 billion in the last quarter of 2016. After this low point, there is a gradual increase reaching around $5.53 billion by the third quarter of 2018, followed by a slight drop to $5.23 billion at the end of 2018. This suggests a contraction in outstanding receivables concurrent with the revenue decline, subsequently reversing as revenue begins to recover.
- Receivables turnover
-
The receivables turnover ratio starts at about 5.07 in early 2015 and shows a downward trend until late 2016, reaching a low of approximately 3.89. A mild recovery is observed beginning in 2017, with the ratio climbing steadily to 4.58 by the last reported quarter in 2018. This indicates that although the company was collecting receivables less frequently during the revenue decline, collection efficiency improved gradually as market conditions recovered.
Overall, the data reflects a period of financial stress from 2015 through 2016 marked by declining revenue and reduced turnover in receivables. The subsequent quarters indicate a recovery with improving revenue and receivables management efficiency, though neither fully returns to early 2015 levels by the end of 2018.
Payables Turnover
Halliburton Co., payables turnover calculation (quarterly data)
Based on: 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-K (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-K (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31).
1 Q4 2018 Calculation
Payables turnover
= (Cost of services and product salesQ4 2018
+ Cost of services and product salesQ3 2018
+ Cost of services and product salesQ2 2018
+ Cost of services and product salesQ1 2018)
÷ Accounts payable
= ( + + + )
÷ =
- Cost of Services and Product Sales
- The cost of services and product sales shows a clear downward trend from March 31, 2015 to December 31, 2016, declining from 6,285 million US dollars to a low of 3,662 million US dollars in September 2016. Following this period, the costs began to gradually increase, reaching 5,269 million US dollars by December 31, 2018. This pattern indicates an initial phase of cost reduction over approximately two years, succeeded by a period of rising expenses towards the end of the period analyzed.
- Accounts Payable
- Accounts payable also demonstrate a downward trend during the early period, dropping from 2,424 million US dollars at the end of March 2015 to 1,490 million US dollars by June 2016. However, from June 2016 onwards, accounts payable increased steadily, reaching a peak of 3,142 million US dollars in September 2018 before a slight decline to 3,018 million US dollars by December 2018. This suggests an initial effort to reduce payables which reversed into growing liabilities over the latter two years.
- Payables Turnover Ratio
- The payables turnover ratio decreased consistently from 11.27 in March 2015 to a low of 6.63 in September 2018, with a minor uptick to 6.96 by December 2018. This decline reflects a lengthening in the average payment period to suppliers, indicating that the company took more time to settle its payables over the period. The slight increase at the end of the period suggests a modest improvement in payment speed.
- Overall Insights
- The data reveals a clear relationship between cost structures and payables management. The initial reduction in cost of services and accounts payable suggests efforts to control expenses and liabilities. However, the subsequent rise in both costs and payables coincides with a reduced payables turnover ratio, implying extended payment terms or slower payments to suppliers. This could reflect strategic cash flow management or responses to market conditions affecting working capital.
Working Capital Turnover
Halliburton Co., 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 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||
| Current assets | |||||||||||||||||||||
| Less: Current liabilities | |||||||||||||||||||||
| Working capital | |||||||||||||||||||||
| Revenue | |||||||||||||||||||||
| Short-term Activity Ratio | |||||||||||||||||||||
| Working capital turnover1 | |||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||
| Working Capital Turnover, Competitors2 | |||||||||||||||||||||
| SLB N.V. | |||||||||||||||||||||
Based on: 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-K (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-K (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31).
1 Q4 2018 Calculation
Working capital turnover
= (RevenueQ4 2018
+ RevenueQ3 2018
+ RevenueQ2 2018
+ RevenueQ1 2018)
÷ Working capital
= ( + + + )
÷ =
2 Click competitor name to see calculations.
- Working Capital
- The working capital displayed significant fluctuations during the analyzed periods. It peaked notably at the end of 2015, reaching a high point, before declining steadily through 2016 and into early 2017. From mid-2017 onward, working capital stabilized around a lower range compared to earlier years, showing only modest incremental increases towards the end of 2018.
- Revenue
- Revenue exhibited a downward trend from early 2015 to late 2016, with the lowest levels recorded in mid-2016. Thereafter, a recovery phase took place starting in early 2017, with revenue increasing in a relatively consistent manner through 2018, although the levels plateaued somewhat towards the final quarters.
- Working Capital Turnover Ratio
- The working capital turnover ratio experienced a marked decline from 2015 to the end of 2015, reaching its lowest point during the last quarter of 2015. Subsequently, the ratio improved steadily across 2016, indicating increased efficiency in using working capital relative to revenue. This upward trend continued through 2017 and 2018, surpassing earlier years and reaching the highest values by the end of 2018.
- Overall Analysis
- The data suggests that during periods of reduced revenue especially around 2015 and 2016, there was a buildup of working capital, possibly reflecting challenges in converting current assets to sales. With the revenue recovery starting in 2017, working capital decreased to levels more proportional to the sales volume, improving turnover efficiency. The working capital turnover ratio's consistent increase towards 2018 indicates better utilization of working capital in generating revenue, reflecting enhanced operational efficiency.
Average Inventory Processing Period
Halliburton Co., 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 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||||||||||||||||
| Inventory turnover | |||||||||||||||||||||
| Short-term Activity Ratio (no. days) | |||||||||||||||||||||
| Average inventory processing period1 | |||||||||||||||||||||
| Benchmarks (no. days) | |||||||||||||||||||||
| Average Inventory Processing Period, Competitors2 | |||||||||||||||||||||
| SLB N.V. | |||||||||||||||||||||
Based on: 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-K (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-K (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31).
1 Q4 2018 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ =
2 Click competitor name to see calculations.
- Inventory Turnover Ratio
- The inventory turnover ratio shows a varying trend over the examined periods. Initially, there was a notable increase from 7.88 to 9.11, indicating improved efficiency in inventory management. However, this was followed by a gradual decline, reaching a low range around 6.4 to 6.6 during 2016 and early 2017. Subsequently, a moderate recovery is observed, with ratios increasing again to highs near 7.89 by the first half of 2018 before slightly declining towards the end of 2018. This pattern suggests periods of fluctuating operational efficiency in inventory usage, with stronger turnover efficiency in early 2015 and mid-2018, while 2016 represented a period of relative weakening.
- Average Inventory Processing Period
- The average inventory processing period trends inversely to the inventory turnover ratio as expected. Starting at 46 days in early 2015, the processing period shortened to about 40 days mid-2015, indicating faster inventory cycles. However, a significant increase occurred in 2016, with processing days rising above 55 and peaking at 57 days in the third quarter. This aligns with the drop observed in inventory turnover, suggesting slower movement of inventory during this time. From late 2017 through 2018, the processing period gradually decreased again to around 46 days, reflective of improvements in inventory management speed, though a slight uptick toward 53 days at the end of 2018 indicates some deceleration in processing towards the year's close.
- Summary of Trends and Insights
- Over the period analyzed, the inventory turnover and average inventory processing period demonstrate a cyclical pattern with clear inverse relationships. Periods of high turnover correlate with decreased processing days, highlighting gains in inventory efficiency. Conversely, mid-2016 marked a downturn in operational efficiency, reflected by lower turnover and longer inventory holding periods. The recovery noted in 2017 and 2018 suggests a return to more effective inventory management practices, although the slight increase in processing time at the end of 2018 indicates ongoing challenges in maintaining optimal inventory flow. Overall, the data underscores variability in inventory performance, influenced likely by external market conditions or internal operational adjustments.
Average Receivable Collection Period
Halliburton Co., 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 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||||||||||||||||
| Receivables turnover | |||||||||||||||||||||
| Short-term Activity Ratio (no. days) | |||||||||||||||||||||
| Average receivable collection period1 | |||||||||||||||||||||
| Benchmarks (no. days) | |||||||||||||||||||||
| Average Receivable Collection Period, Competitors2 | |||||||||||||||||||||
| SLB N.V. | |||||||||||||||||||||
Based on: 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-K (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-K (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31).
1 Q4 2018 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ =
2 Click competitor name to see calculations.
The analysis of receivables turnover and average receivable collection period over the examined quarters reveals significant patterns related to the company's efficiency in managing its receivables.
- Receivables Turnover
- The receivables turnover ratio displays a declining trend from March 2015 through September 2017, falling from 5.07 to a low of 3.85. This decline suggests a gradual decrease in the company's effectiveness in collecting receivables over this period. However, starting from December 2017, the ratio shows an improvement, ascending steadily to 4.58 by December 2018. This shift indicates a positive change in receivables management and collection efficiency in the most recent quarters.
- Average Receivable Collection Period
- Corresponding with the receivables turnover trend, the average receivable collection period increased markedly from 72 days in March 2015 to a peak of 95 days in September 2017. This increase implies that on average, receivables took longer to be collected, reflecting lower collection efficiency. From December 2017 onwards, the collection period consistently decreased, reaching 80 days by December 2018, which aligns with the uptick in the receivables turnover ratio and represents enhanced collection speed.
Overall, the company experienced a period of deteriorating receivables management performance lasting approximately two and a half years, followed by a clear recovery phase in the last four quarters of the examined period. The improved turnover ratio coupled with a shortening collection period suggests that recent operational or credit policy adjustments might have positively impacted the management of accounts receivable.
Operating Cycle
Halliburton Co., 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 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||||||||||||||||
| Average inventory processing period | |||||||||||||||||||||
| Average receivable collection period | |||||||||||||||||||||
| Short-term Activity Ratio | |||||||||||||||||||||
| Operating cycle1 | |||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||
| Operating Cycle, Competitors2 | |||||||||||||||||||||
| SLB N.V. | |||||||||||||||||||||
Based on: 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-K (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-K (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31).
1 Q4 2018 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= + =
2 Click competitor name to see calculations.
- Inventory Processing Period
- The average inventory processing period initially decreased from 46 days in March 2015 to 40 days by June 2015, indicating improved efficiency in inventory turnover. Following this decline, the period increased sharply to reach a peak of 57 days in September 2016, signaling a slowdown in inventory processing. From that peak, the period gradually reduced again to around 48–53 days during 2017 and 2018, suggesting a partial recovery in inventory management efficiency, though it did not return to the earlier lows seen in 2015.
- Receivable Collection Period
- The average receivable collection period showed a consistent upward trend from 72 days in March 2015 to a peak of 95 days in September 2017. This indicates a lengthening of the time taken to collect receivables, which may reflect weakening credit control or customer payment delays. After peaking, the period decreased gradually to 80 days by March 2018, demonstrating some improvement in collection efficiency but still remaining higher than the 2015 level.
- Operating Cycle
- The operating cycle, representing the total time to convert inventory and receivables into cash, followed an upward trajectory from 118 days in March 2015 to a maximum of 151 days in September 2016. This increase reflects extended durations in both inventory processing and receivables collection. After this peak, the cycle declined moderately to around 133–135 days during 2017 and early 2018, suggesting an improvement in overall operational efficiency, yet the cycle remained longer than in early 2015.
Average Payables Payment Period
Halliburton Co., average payables payment period calculation (quarterly data)
Based on: 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-K (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-K (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31).
1 Q4 2018 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ =
- Payables Turnover Ratio
- The payables turnover ratio generally demonstrates a declining trend over the examined period. Starting at approximately 11.27 in March 2015, it rose slightly to a peak of 11.82 by mid-2015, followed by a steady decline through subsequent quarters. By the end of 2016, the ratio had decreased considerably to around 8.52, and the downward trend continued into 2017 and 2018, reaching a low near 6.63 before a minor increase at the end of 2018. This pattern suggests that the company is turning over its payables less frequently, potentially indicating extended payment cycles to suppliers over time.
- Average Payables Payment Period
- The average payables payment period exhibited an upward trajectory throughout the reported quarters. Initially, the payment period was about 32 days in early 2015. It fluctuated slightly within the 30 to 36-day range until late 2016. From this point, there was a noticeable increase in days payable outstanding, reaching a peak of 55 days in mid to late 2018, with a modest reduction to 52 days by the end of 2018. This increasing trend aligns with the declining payables turnover ratio and indicates that the company was gradually extending the time taken to settle its payables, reflecting a slower payment pace to creditors.
- Overall Insights
- The inverse relationship between the payables turnover ratio and the average payables payment period is evident, reflecting changes in the company's payment practices. Over the four-year span, the data suggests a strategic shift to longer payment terms or a delay in payments, which may be aimed at managing cash flows more conservatively. This trend could impact supplier relations and may need to be evaluated in the context of broader financial strategies and market conditions.
Cash Conversion Cycle
Halliburton Co., cash conversion cycle calculation (quarterly data)
No. days
Based on: 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-K (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-K (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31).
1 Q4 2018 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= + – =
- Average Inventory Processing Period
- The average inventory processing period demonstrated a fluctuating pattern over the examined quarters. In the initial year, the period decreased from 46 days to 40 days and then stabilized around the low forties. However, starting in early 2016, the period increased significantly to about 56-57 days, maintaining this elevated level through the end of 2016. In the subsequent years, the period showed a slight declining trend, moving down towards the high 40s and low 50s by late 2018, indicating some improvement in inventory turnover efficiency.
- Average Receivable Collection Period
- The receivable collection period exhibited a general upward trend from 72 days in early 2015 to a peak around 95 days by late 2017. This indicates a lengthening in the time taken to collect receivables, which may negatively impact liquidity. From the end of 2017 through 2018, a gradual decline to 80 days was observed, suggesting an improvement in collection efficiency during the final periods covered.
- Average Payables Payment Period
- The average payables payment period steadily increased throughout the period, beginning at 32 days in early 2015 and rising to above 50 days by 2017 and 2018. This increase suggests that the company extended the time it takes to settle its payables, potentially improving short-term cash flow but possibly affecting supplier relationships.
- Cash Conversion Cycle
- The cash conversion cycle experienced variability with an overall upward trend from 86 days in the first quarter of 2015 to a peak of 116 days in mid to late 2016, indicating a deterioration in cash flow efficiency. Following this peak, the cycle contracted gradually to about 80 days by the end of 2018, reflecting some recovery and improved efficiency in converting resources into cash. Despite this improvement, the cycle remained longer compared to the early 2015 levels.