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)
Kinder Morgan Inc., short-term (operating) activity ratios (quarterly data)
Based on: 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), 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 is available from March 2015 onwards, fluctuating between approximately 8.8 and 11.48 over the period analyzed. Initially, it remained around 10 to 10.3 in 2015 and 2016, with peaks near 11.4 in early 2018, suggesting efficient inventory management during that time. Toward 2019 and early 2020, a downward trend is observed with turnover dipping below 9, indicating slower inventory movement.
- Receivables Turnover
- Receivables turnover shows variability but generally remains within the range of 9.4 to 11.6 throughout the periods recorded. The ratio tends to decline slightly in the final quarters, particularly in late 2019 and early 2020, reaching as low as 9.64. This trend may reflect increasing challenges in collecting receivables promptly.
- Payables Turnover
- Payables turnover displays significant variation, with a clear rise observed in 2019, reaching highs above 4 before declining somewhat in early 2020. This indicates that the company was paying its suppliers at a faster rate during 2019 compared to earlier periods where turnover was consistently closer to 3.
- Working Capital Turnover
- Data on working capital turnover is sparse, with a notable figure only for March 2019 at 50.52. Due to the lack of additional data points, a trend analysis is not feasible.
- Average Inventory Processing Period
- The average inventory days fluctuate modestly between 32 and 42 days. The lowest averages occurred in mid to late 2018 (32 days), indicating improved inventory processing efficiency, whereas peaks near 40 to 42 days in 2019 suggest somewhat slower turnover at those times.
- Average Receivable Collection Period
- This period ranges between 31 and 39 days, with some elongation noted toward the end of 2015 and during certain points in 2018 and 2019. The data suggests that the company experienced some variation in the speed of collecting receivables, with no persistent trend of improvement or deterioration.
- Operating Cycle
- The operating cycle remains roughly stable, varying between 66 and 80 days over the recorded quarters. Peaks around 75 to 80 days in late 2017 and 2019 indicate periods of lengthier combined inventory holding and receivable collection, while troughs near 66-68 days occurred in 2015 and parts of 2018, reflecting improved operational efficiency.
- Average Payables Payment Period
- The average payables payment period shows a decreasing trend from over 130 days at the end of 2015 to as low as 81 days in mid-2019, before increasing again to above 90 days by early 2020. This suggests the company initially extended payment periods but then accelerated payments before reverting to longer payment cycles.
- Cash Conversion Cycle
- The cash conversion cycle is consistently negative throughout the period, indicating that the company receives cash from operations before paying its suppliers. The length of this negative cycle improves notably from -48 days in early 2015 to as little as -9 days in mid-2019, implying better liquidity timing, before slightly lengthening again to around -20 days by March 2020.
Turnover Ratios
Average No. Days
Inventory Turnover
Kinder Morgan Inc., inventory turnover calculation (quarterly data)
| Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | 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) | ||||||||||||||||||||||||||||
| Costs of sales | 663) | 776) | 762) | 777) | 948) | 1,199) | 1,135) | 1,068) | 1,019) | 1,145) | 1,029) | 1,090) | 1,081) | 1,044) | 971) | 752) | 731) | 834) | 1,106) | 1,085) | 1,090) | |||||||
| Inventories | 307) | 371) | 405) | 450) | 429) | 385) | 383) | 420) | 442) | 424) | 428) | 438) | 380) | 357) | 325) | 361) | 364) | 407) | 445) | 474) | 453) | |||||||
| Short-term Activity Ratio | ||||||||||||||||||||||||||||
| Inventory turnover1 | 9.70 | 8.80 | 9.10 | 9.02 | 10.14 | 11.48 | 11.40 | 10.15 | 9.69 | 10.25 | 9.92 | 9.56 | 10.13 | 9.80 | 10.12 | 9.48 | 10.32 | 10.11 | — | — | — | |||||||
| Benchmarks | ||||||||||||||||||||||||||||
| Inventory Turnover, Competitors2 | ||||||||||||||||||||||||||||
| Chevron Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| ConocoPhillips | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Exxon Mobil Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Occidental Petroleum Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 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), 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 Q1 2020 Calculation
Inventory turnover
= (Costs of salesQ1 2020
+ Costs of salesQ4 2019
+ Costs of salesQ3 2019
+ Costs of salesQ2 2019)
÷ Inventories
= (663 + 776 + 762 + 777)
÷ 307 = 9.70
2 Click competitor name to see calculations.
- Costs of Sales
- The costs of sales exhibit a generally fluctuating pattern over the quarterly periods analyzed. Starting from a high of 1,090 million USD in March 2015, costs decreased notably to 731 million USD by March 2016, indicating a substantial reduction in expenses over this period. However, following this decline, there was a recovery in costs, reaching as high as 1,199 million USD in December 2018. From that peak, the costs demonstrated a downward trend again, falling to 663 million USD by March 2020. This fluctuation may suggest variability in production levels, procurement costs, or operational efficiencies over time, with a notable decrease towards the start of 2020.
- Inventories
- The inventory levels showed a gradual overall decline from the beginning to the end of the data series. Initially, inventories were at 453 million USD in March 2015, followed by some minor variability across quarters, including slight reductions and increments. Notably, inventory levels dipped to 364 million USD by March 2016 and then exhibited some recovery up to 450 million USD in June 2019. However, a sharp decrease is observed after mid-2019, with inventories falling to 307 million USD by March 2020. This reduction closer to the end of the period may indicate tighter inventory management or reduced stockholding possibly related to changes in demand or supply chain adjustments.
- Inventory Turnover Ratio
- The inventory turnover ratio consistently remained around the 9 to 11 range throughout the analyzed periods. This metric, which measures how efficiently inventory is being managed relative to sales levels, shows relatively stable operational efficiency. The ratio increased gradually over time, with a peak reaching 11.48 in June 2018, suggesting improved inventory utilization during that period. However, following the peak, the turnover ratio declined to 8.8 in September 2019 before slightly recovering to 9.7 in March 2020. The reduction in turnover ratio towards the end may reflect a slower inventory movement or buildup of inventory relative to sales.
- Overall Insights
- The data shows cyclical trends in costs of sales and inventory levels, with costs of sales displaying more pronounced volatility. Inventories were managed within a moderate range but declined towards the end of the period. The inventory turnover ratio remained relatively stable, indicating consistent inventory management practices, though slight variations towards the end suggest potential operational shifts. The decline in both costs of sales and inventories by early 2020 might correlate with broader market or company-specific factors affecting supply and demand dynamics.
Receivables Turnover
Kinder Morgan Inc., receivables turnover calculation (quarterly data)
| Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | 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) | ||||||||||||||||||||||||||||
| Revenues | 3,106) | 3,352) | 3,214) | 3,214) | 3,429) | 3,781) | 3,517) | 3,428) | 3,418) | 3,632) | 3,281) | 3,368) | 3,424) | 3,389) | 3,330) | 3,144) | 3,195) | 3,636) | 3,707) | 3,463) | 3,597) | |||||||
| Accounts receivable, net | 1,186) | 1,370) | 1,273) | 1,227) | 1,310) | 1,498) | 1,384) | 1,357) | 1,349) | 1,448) | 1,194) | 1,184) | 1,263) | 1,370) | 1,282) | 1,278) | 1,203) | 1,315) | 1,404) | 1,349) | 1,420) | |||||||
| Short-term Activity Ratio | ||||||||||||||||||||||||||||
| Receivables turnover1 | 10.87 | 9.64 | 10.71 | 11.36 | 10.81 | 9.44 | 10.11 | 10.14 | 10.15 | 9.46 | 11.27 | 11.41 | 10.52 | 9.53 | 10.38 | 10.71 | 11.64 | 10.95 | — | — | — | |||||||
| Benchmarks | ||||||||||||||||||||||||||||
| Receivables Turnover, Competitors2 | ||||||||||||||||||||||||||||
| Chevron Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| ConocoPhillips | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Occidental Petroleum Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 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), 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 Q1 2020 Calculation
Receivables turnover
= (RevenuesQ1 2020
+ RevenuesQ4 2019
+ RevenuesQ3 2019
+ RevenuesQ2 2019)
÷ Accounts receivable, net
= (3,106 + 3,352 + 3,214 + 3,214)
÷ 1,186 = 10.87
2 Click competitor name to see calculations.
The company's revenue figures exhibit fluctuations over the observed periods, with an overall moderate variability. Initial revenues in early 2015 are around 3.6 billion US dollars, followed by a downward trend through mid-2016 reaching just above 3.1 billion. Revenues then experience intermittent increases, peaking near 3.8 billion at the end of 2018, but ultimately trend slightly downward again to just above 3.1 billion by the first quarter of 2020. This pattern indicates a cyclical but somewhat stable revenue environment with variations likely tied to market conditions or operational factors.
Accounts receivable, net, demonstrates relatively stable levels but with some periodic variation. Values start at 1.42 billion in the first quarter of 2015 and generally oscillate within a range of approximately 1.18 to 1.5 billion over the timeframe, reaching peaks at the end of 2018 and early 2019 before declining again by early 2020. This pattern suggests consistent credit sales but potential fluctuations in collection periods or credit policies throughout the years.
The receivables turnover ratio, available from late 2015 onwards, shows some variability but remains within a moderate band between approximately 9.4 and 11.6 times. This indicates a generally stable efficiency in managing receivables, with the ratio reflecting moderately quick collections relative to sales. Notably, higher turnover ratios in some quarters imply improved receivables management or more stringent credit control, while lower ratios may indicate slower collection periods or changes in customer payment behavior.
- Revenue Trend
- Revenues fluctuated between roughly 3.1 billion and 3.8 billion US dollars, with peaks in late 2018 and troughs around mid-2016 and early 2020.
- Accounts Receivable
- Accounts receivable levels remained relatively stable but showed periodic increases near late 2018 and mid-2019, indicating potential delays or changes in collection practices.
- Receivables Turnover
- The turnover ratio ranged between 9.4 and 11.6 times, reflecting moderately stable collections efficiency, with some quarter-to-quarter variability corresponding to fluctuations in receivables and revenue.
Payables Turnover
Kinder Morgan Inc., payables turnover calculation (quarterly data)
| Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | 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) | ||||||||||||||||||||||||||||
| Costs of sales | 663) | 776) | 762) | 777) | 948) | 1,199) | 1,135) | 1,068) | 1,019) | 1,145) | 1,029) | 1,090) | 1,081) | 1,044) | 971) | 752) | 731) | 834) | 1,106) | 1,085) | 1,090) | |||||||
| Accounts payable | 752) | 914) | 916) | 900) | 1,012) | 1,337) | 1,307) | 1,269) | 1,221) | 1,340) | 1,358) | 1,353) | 1,214) | 1,257) | 1,192) | 1,087) | 1,017) | 1,324) | 1,226) | 1,293) | 1,393) | |||||||
| Short-term Activity Ratio | ||||||||||||||||||||||||||||
| Payables turnover1 | 3.96 | 3.57 | 4.02 | 4.51 | 4.30 | 3.31 | 3.34 | 3.36 | 3.51 | 3.24 | 3.13 | 3.09 | 3.17 | 2.78 | 2.76 | 3.15 | 3.69 | 3.11 | — | — | — | |||||||
| Benchmarks | ||||||||||||||||||||||||||||
| Payables Turnover, Competitors2 | ||||||||||||||||||||||||||||
| Chevron Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| ConocoPhillips | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Occidental Petroleum Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 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), 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 Q1 2020 Calculation
Payables turnover
= (Costs of salesQ1 2020
+ Costs of salesQ4 2019
+ Costs of salesQ3 2019
+ Costs of salesQ2 2019)
÷ Accounts payable
= (663 + 776 + 762 + 777)
÷ 752 = 3.96
2 Click competitor name to see calculations.
The financial data presents a detailed view over several quarters for key metrics including costs of sales, accounts payable, and payables turnover ratio. A careful examination reveals several notable trends and variations throughout the periods.
- Costs of Sales
- Costs of sales exhibited significant fluctuations over the timeframe observed. Initially, costs remained relatively stable around the 1080-1110 million US$ range during 2015, with a prominent dip to 834 million US$ in the last quarter of 2015. This decline was followed by an increase in 2016, peaking near 1044 million US$ by the end of that year. Costs continued to generally rise through 2017 and 2018, reaching a high of 1199 million US$ in the last quarter of 2018. However, costs sharply declined again through 2019 and into the first quarter of 2020, down to 663 million US$. These fluctuations may indicate varying levels of operational activity or cost control measures implemented during different periods.
- Accounts Payable
- Accounts payable also showed variability but without a clear consistent trend. Starting at 1393 million US$ in the first quarter of 2015, payables decreased during the first three quarters to a low of 1226 million US$. They then increased again towards the end of 2015, reaching 1324 million US$. During 2016 and 2017, accounts payable fluctuated moderately within a 1200-1350 million US$ range. In 2018, a gradual decrease was observed moving from around 1300 million US$ to 1337 million US$ by year's end. The most significant decline occurred in 2019 and early 2020, dropping from 1012 million US$ down to 752 million US$. This downward movement in payables might reflect changes in supplier payment practices or reduced procurement activities in response to external factors.
- Payables Turnover Ratio
- The payables turnover ratio, available for most quarters from March 2016 onward, generally ranged between approximately 2.76 and 4.51. The ratio started at 3.11 in March 2016, briefly increasing towards 3.69 in the second quarter, and then showing a slight overall decline through 2016 and early 2017, fluctuating around the 3.1 to 3.3 mark. From 2018 through 2019, a noticeable increase was evident, reaching a peak of 4.51 in the second quarter of 2019. Subsequently, the ratio decreased slightly while maintaining elevated levels around 3.5 to 4.0 towards the end of 2019 and beginning 2020. Higher payables turnover values imply faster payment cycles or improved efficiency in settling accounts payable, suggesting the company may have been accelerating payments or better managing supplier relationships during the later periods.
Overall, the data indicates variability in costs of sales and accounts payable, with an apparent emphasis on cost moderation and supplier payment efficiency in more recent quarters. The declining trend in both costs of sales and accounts payable towards early 2020 could signify operational contraction or strategic financial management possibly in response to evolving market conditions. Meanwhile, the rising payables turnover ratio during 2018 and 2019 points to improved accounts payable management during those periods.
Working Capital Turnover
Kinder Morgan Inc., working capital turnover calculation (quarterly data)
| Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | 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 | 3,096) | 3,238) | 2,365) | 2,300) | 2,262) | 5,722) | 5,766) | 2,634) | 2,628) | 2,715) | 2,613) | 2,726) | 2,675) | 3,229) | 3,363) | 2,470) | 2,481) | 2,824) | 3,067) | 2,936) | 3,289) | |||||||
| Less: Current liabilities | 5,608) | 5,100) | 6,826) | 5,659) | 5,009) | 7,557) | 5,489) | 5,379) | 5,429) | 6,181) | 6,174) | 6,363) | 6,689) | 5,924) | 6,044) | 6,566) | 4,396) | 4,065) | 6,191) | 6,499) | 6,784) | |||||||
| Working capital | (2,512) | (1,862) | (4,461) | (3,359) | (2,747) | (1,835) | 277) | (2,745) | (2,801) | (3,466) | (3,561) | (3,637) | (4,014) | (2,695) | (2,681) | (4,096) | (1,915) | (1,241) | (3,124) | (3,563) | (3,495) | |||||||
| Revenues | 3,106) | 3,352) | 3,214) | 3,214) | 3,429) | 3,781) | 3,517) | 3,428) | 3,418) | 3,632) | 3,281) | 3,368) | 3,424) | 3,389) | 3,330) | 3,144) | 3,195) | 3,636) | 3,707) | 3,463) | 3,597) | |||||||
| Short-term Activity Ratio | ||||||||||||||||||||||||||||
| Working capital turnover1 | — | — | — | — | — | — | 50.52 | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Benchmarks | ||||||||||||||||||||||||||||
| Working Capital Turnover, Competitors2 | ||||||||||||||||||||||||||||
| Chevron Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| ConocoPhillips | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Exxon Mobil Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Occidental Petroleum Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 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), 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 Q1 2020 Calculation
Working capital turnover
= (RevenuesQ1 2020
+ RevenuesQ4 2019
+ RevenuesQ3 2019
+ RevenuesQ2 2019)
÷ Working capital
= (3,106 + 3,352 + 3,214 + 3,214)
÷ -2,512 = —
2 Click competitor name to see calculations.
- Working Capital
- The working capital figures display a predominantly negative value across all periods, indicating that current liabilities consistently exceeded current assets. From March 2015 to December 2016, working capital showed volatility, with values oscillating between approximately -3495 million and -2695 million USD, with a notable spike to -1241 million in December 2015 suggesting a temporary improvement. However, from 2017 onwards, the negative working capital further deteriorated, reaching a low of -4461 million USD in December 2019. A brief positive anomaly appears in September 2018 at 277 million USD, which contrasts sharply with surrounding negative quarters, indicating either a one-off asset influx or liability reduction. The overall trend points to persistent negative working capital with significant fluctuations and a slight improvement at the start of 2020.
- Revenues
- Revenue values remained relatively stable throughout the observed period, fluctuating between roughly 3100 million and 3800 million USD. There was a mild downward trend observed from early 2015 (above 3500 million USD) to mid-2016 and mid-2019 when figures dipped near 3200 million USD. A modest peak occurred in December 2018 at 3781 million USD, followed by a decline thereafter. The last recorded quarter, March 2020, showed a decrease to 3106 million USD from 3352 million in the previous quarter, indicating potential beginning effects of external pressures or market conditions impacting sales.
- Working Capital Turnover
- The working capital turnover ratio is only reported for one quarter, at a notably high value of 50.52. This unusual magnitude, combined with the lack of other data points, suggests either an isolated calculation due to data availability limits or an anomaly possibly linked to the infrequent positive working capital recorded in that period. Without continuous data, definitive trend analysis or interpretation is restricted.
- Summary
- Overall, the company exhibits a challenging working capital position characterized by consistent negative values with notable variability over the years, including a rare positive instance in 2018. Revenues have been relatively stable but experiencing minor declines over time with periodic quarterly fluctuations. The limited working capital turnover data prevents full analysis of operational efficiency in this dimension. The observed financial patterns suggest the company might be managing liquidity constraints, while maintaining relatively steady top-line performance, though recent declines in both working capital and revenue may warrant closer monitoring.
Average Inventory Processing Period
Kinder Morgan Inc., average inventory processing period calculation (quarterly data)
| Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | 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 | 9.70 | 8.80 | 9.10 | 9.02 | 10.14 | 11.48 | 11.40 | 10.15 | 9.69 | 10.25 | 9.92 | 9.56 | 10.13 | 9.80 | 10.12 | 9.48 | 10.32 | 10.11 | — | — | — | |||||||
| Short-term Activity Ratio (no. days) | ||||||||||||||||||||||||||||
| Average inventory processing period1 | 38 | 42 | 40 | 40 | 36 | 32 | 32 | 36 | 38 | 36 | 37 | 38 | 36 | 37 | 36 | 38 | 35 | 36 | — | — | — | |||||||
| Benchmarks (no. days) | ||||||||||||||||||||||||||||
| Average Inventory Processing Period, Competitors2 | ||||||||||||||||||||||||||||
| Chevron Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| ConocoPhillips | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Exxon Mobil Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Occidental Petroleum Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 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), 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 Q1 2020 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 9.70 = 38
2 Click competitor name to see calculations.
- Inventory Turnover
- The inventory turnover ratio demonstrates a relatively stable pattern with minor fluctuations from March 31, 2015, through March 31, 2020. Starting around 10.11 in early 2015, the ratio mostly stayed within the range of approximately 9.5 to 11.5 over the reported quarters. Notably, a peak occurs in early 2018, reaching about 11.48, followed by a general decline in 2019, where values decrease to around 8.8 by late 2019. The ratio then shows a slight recovery towards 9.7 in the first quarter of 2020. This suggests that inventory was turned over about 9 to 11 times annually, with some periods indicating slower turnover, particularly in late 2019.
- Average Inventory Processing Period
- The average inventory processing period, measured in number of days, reveals an inverse general relationship to the inventory turnover ratio as expected. Beginning at roughly 36 days in early 2015, this metric fluctuates modestly, mostly between 32 and 40 days over the time span. The most notable variations are a decrease to 32 days in 2018, indicating faster inventory processing during this period, followed by a gradual increase towards 40-42 days in late 2019, signifying slower inventory movement. By March 2020, the period shortens again to 38 days. The trend aligns with the turnover ratios, reflecting intermittent efficiency changes in inventory management.
- Overall Trends and Insights
- The data indicates steady overall inventory management efficiency with some variability. Higher inventory turnover ratios correspond with shorter inventory processing periods, reflecting periods of improved inventory handling. Conversely, the decline in turnover ratio and increase in processing period towards the end of 2019 suggests some operational challenges or changes in sales demand affecting inventory velocity. The subsequent modest recovery in early 2020 may indicate corrective measures or market adjustments. The lack of significant long-term upward or downward trends suggests that inventory performance remained largely consistent with typical seasonal or market-driven fluctuations throughout the period analyzed.
Average Receivable Collection Period
Kinder Morgan Inc., average receivable collection period calculation (quarterly data)
| Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | 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 | 10.87 | 9.64 | 10.71 | 11.36 | 10.81 | 9.44 | 10.11 | 10.14 | 10.15 | 9.46 | 11.27 | 11.41 | 10.52 | 9.53 | 10.38 | 10.71 | 11.64 | 10.95 | — | — | — | |||||||
| Short-term Activity Ratio (no. days) | ||||||||||||||||||||||||||||
| Average receivable collection period1 | 34 | 38 | 34 | 32 | 34 | 39 | 36 | 36 | 36 | 39 | 32 | 32 | 35 | 38 | 35 | 34 | 31 | 33 | — | — | — | |||||||
| Benchmarks (no. days) | ||||||||||||||||||||||||||||
| Average Receivable Collection Period, Competitors2 | ||||||||||||||||||||||||||||
| Chevron Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| ConocoPhillips | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Occidental Petroleum Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 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), 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 Q1 2020 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 10.87 = 34
2 Click competitor name to see calculations.
The receivables turnover ratio demonstrates fluctuations throughout the observed periods from 2015 to 2020. Starting from a ratio of 10.95 in March 2015, the ratio exhibits a mild downward trend into 2016 and 2017, reaching lows near 9.46 in March 2018. Following this, the ratio generally recovers, with several peaks over 11, particularly in June 2017 and June 2019, but maintains a level around 10 by March 2020. Overall, the turnover ratio oscillates but remains within a relatively narrow range between approximately 9.4 and 11.6.
In contrast, the average receivable collection period, which inversely correlates with the turnover ratio, shows a corresponding pattern. Initially at 33 days in March 2015, the collection period shortens slightly to 31 days in mid-2015 but then gradually increases, peaking at around 39 days multiple times, notably at the end of 2015, end of 2017, and early 2019. Despite these peaks, the average collection period generally moves within a band between 31 and 39 days, ending at 34 days by March 2020.
- Receivables Turnover Ratio
- Shows moderate variability with occasional peaks exceeding 11, indicating periods of efficient receivables management.
- The ratio tends to decline during certain quarters, suggesting temporary elongation in collection or slower turnover of receivables.
- The range remains fairly stable over the years, without significant deteriorations or improvements.
- Average Receivable Collection Period
- Varies inversely with the turnover ratio, fluctuating between 31 to 39 days predominantly.
- Periods with higher collection days coincide with lower turnover ratios, indicative of slower collections.
- The collection period remains relatively stable without extreme deviations, implying consistent credit policies or collection efficiencies.
In summary, the company's receivables turnover and collection period display patterns consistent with normal operational fluctuations. While minor variances in efficiency are observed quarter to quarter, overall receivables management appears steady, suggesting no significant changes in credit policy or major issues with customer collections during the period analyzed.
Operating Cycle
Kinder Morgan Inc., operating cycle calculation (quarterly data)
No. days
| Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | 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 | 38 | 42 | 40 | 40 | 36 | 32 | 32 | 36 | 38 | 36 | 37 | 38 | 36 | 37 | 36 | 38 | 35 | 36 | — | — | — | |||||||
| Average receivable collection period | 34 | 38 | 34 | 32 | 34 | 39 | 36 | 36 | 36 | 39 | 32 | 32 | 35 | 38 | 35 | 34 | 31 | 33 | — | — | — | |||||||
| Short-term Activity Ratio | ||||||||||||||||||||||||||||
| Operating cycle1 | 72 | 80 | 74 | 72 | 70 | 71 | 68 | 72 | 74 | 75 | 69 | 70 | 71 | 75 | 71 | 72 | 66 | 69 | — | — | — | |||||||
| Benchmarks | ||||||||||||||||||||||||||||
| Operating Cycle, Competitors2 | ||||||||||||||||||||||||||||
| Chevron Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| ConocoPhillips | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Occidental Petroleum Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 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), 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 Q1 2020 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= 38 + 34 = 72
2 Click competitor name to see calculations.
- Average Inventory Processing Period
- The average inventory processing period demonstrated moderate fluctuations over the analyzed quarters. Starting from 36 days in March 2016, the period varied between a low of 32 days (recorded in December 2018 and March 2019) and a high of 42 days in September 2019. The trend indicates occasional increases beyond the mid-30s range, reflecting some variability in inventory turnover efficiency. Toward the latest quarter, ending March 2020, the period settled at 38 days, slightly above its early observed values.
- Average Receivable Collection Period
- The receivable collection period displayed a pattern of relative stability with mild oscillations throughout the timeframe. Initially around the low 30s in March 2016, the period experienced rises to peaks near 39 days in December 2016 and March 2018, suggesting occasional delays in receivable collections. The most recent data point at March 2020 shows a value of 34 days, consistent with the overall historical range and indicating no significant deterioration or improvement in credit management.
- Operating Cycle
- The operating cycle, being the sum of inventory processing and receivable collection periods, followed a consistent pattern between approximately 66 and 80 days. Starting near 69 days in March 2016, it slightly increased to peak values around 80 days in December 2019. This upward trend reflects the combined effect of fluctuations in inventory and receivables periods. Despite these changes, the operating cycle remained relatively steady, ending at 72 days in March 2020, which is within previous historical bounds.
Average Payables Payment Period
Kinder Morgan Inc., average payables payment period calculation (quarterly data)
| Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | 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 | ||||||||||||||||||||||||||||
| Payables turnover | 3.96 | 3.57 | 4.02 | 4.51 | 4.30 | 3.31 | 3.34 | 3.36 | 3.51 | 3.24 | 3.13 | 3.09 | 3.17 | 2.78 | 2.76 | 3.15 | 3.69 | 3.11 | — | — | — | |||||||
| Short-term Activity Ratio (no. days) | ||||||||||||||||||||||||||||
| Average payables payment period1 | 92 | 102 | 91 | 81 | 85 | 110 | 109 | 109 | 104 | 113 | 117 | 118 | 115 | 131 | 132 | 116 | 99 | 117 | — | — | — | |||||||
| Benchmarks (no. days) | ||||||||||||||||||||||||||||
| Average Payables Payment Period, Competitors2 | ||||||||||||||||||||||||||||
| Chevron Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| ConocoPhillips | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Occidental Petroleum Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 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), 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 Q1 2020 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 3.96 = 92
2 Click competitor name to see calculations.
- Payables turnover
- The payables turnover ratio exhibits a general upward trend from early 2016 through the first quarter of 2020, despite some fluctuations. Starting at 3.11 in March 2016, the ratio increased to a peak of 4.51 by June 2019, indicating an improvement in the frequency with which payables are paid off. Following this peak, the ratio slightly decreased to 3.96 by March 2020. The fluctuations observed between quarters suggest some variability in the company's payment patterns, but the overall pattern points to a stronger payables turnover performance over the period.
- Average payables payment period
- The average payables payment period, measured in days, shows a general downward trend during the reported period, indicating that the company has been reducing the length of time it takes to pay its suppliers. Beginning at 117 days in March 2016, the payment period extended to a higher range around 132 days by December 2015, then progressively decreased to a low of 81 days in June 2019. Following this low, it experienced a moderate increase, ending at 92 days in March 2020. The inverse relationship between the payables turnover ratio and the payment period is consistent, as shorter payment periods correspond to higher turnover ratios.
- Overall insights
- The data indicates that the company has generally improved its management of accounts payable over the observed timeframe up to 2020, as evidenced by faster turnover and shorter payment periods. Despite some quarters showing slight reversals, the overall direction suggests enhanced efficiency in settling payables, potentially improving working capital management and supplier relationships.
Cash Conversion Cycle
Kinder Morgan Inc., cash conversion cycle calculation (quarterly data)
No. days
| Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | 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 | 38 | 42 | 40 | 40 | 36 | 32 | 32 | 36 | 38 | 36 | 37 | 38 | 36 | 37 | 36 | 38 | 35 | 36 | — | — | — | |||||||
| Average receivable collection period | 34 | 38 | 34 | 32 | 34 | 39 | 36 | 36 | 36 | 39 | 32 | 32 | 35 | 38 | 35 | 34 | 31 | 33 | — | — | — | |||||||
| Average payables payment period | 92 | 102 | 91 | 81 | 85 | 110 | 109 | 109 | 104 | 113 | 117 | 118 | 115 | 131 | 132 | 116 | 99 | 117 | — | — | — | |||||||
| Short-term Activity Ratio | ||||||||||||||||||||||||||||
| Cash conversion cycle1 | -20 | -22 | -17 | -9 | -15 | -39 | -41 | -37 | -30 | -38 | -48 | -48 | -44 | -56 | -61 | -44 | -33 | -48 | — | — | — | |||||||
| Benchmarks | ||||||||||||||||||||||||||||
| Cash Conversion Cycle, Competitors2 | ||||||||||||||||||||||||||||
| Chevron Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| ConocoPhillips | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Occidental Petroleum Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 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), 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 Q1 2020 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 38 + 34 – 92 = -20
2 Click competitor name to see calculations.
Analyzing the financial trends over the periods reveals several notable patterns in the company's working capital management metrics. The average inventory processing period exhibited fluctuations, initially ranging from 35 to 38 days in 2015 and 2016, maintaining around 36 to 38 days throughout most of 2017 and 2018. However, a slight improvement is observable in late 2018 and early 2019 when the period decreased to the low 30s, before increasing again to over 40 days in late 2019, followed by a reduction to 38 days in the first quarter of 2020.
The average receivable collection period showed variability but mostly fluctuated between low 30s and high 30s days throughout the period analyzed. Starting around 31 to 35 days in 2015-2016, it peaked near 39 days on several occasions in the subsequent years, indicating occasional delays in receivables collection. Despite these fluctuations, the overall receivable collection period did not show a clear trend of improvement or deterioration, staying within a relatively narrow range of 31 to 39 days.
Regarding the average payables payment period, there was greater variability and a generally decreasing trend over the observed timeline. The period was highest in late 2015 and early 2016, exceeding 115 days and reaching as high as 132 days in December 2015. Thereafter, a discernible downward trend emerges, with the average payment period declining to the 85-110 day range from 2018 onward. This indicates the company may have been expediting payments to suppliers or experiencing other operational changes affecting payables management.
The cash conversion cycle (CCC), which reflects the net duration between outflowing and inflowing cash, remained consistently negative throughout the periods observed. This suggests the company continuously operated with a negative CCC, effectively funding its operating cycle through supplier credit. The CCC shows improvement in magnitude from around -48 days in early periods to less negative values near -20 in early 2020, indicating a shortening cash conversion cycle and potentially more efficient working capital utilization. Despite some fluctuations, the trend towards a less negative CCC might imply the company enhanced operational efficiencies or altered its credit terms with customers and suppliers.
Overall, the data reflect relatively stable management of inventory and receivables with moderate fluctuations. The significant reduction in the payables payment period over the years indicates changes in supplier payment practices, while the consistently negative cash conversion cycle implies strong cash flow dynamics supported by supplier financing. The trend towards a less negative cash conversion cycle towards the end of the period suggests improving cash flow efficiency.