Stock Analysis on Net
Stock Analysis on Net

Linde plc (NASDAQ:LIN)

Analysis of Short-term (Operating) Activity Ratios

Microsoft Excel

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)

Linde plc, short-term (operating) activity ratios

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Turnover Ratios
Inventory turnover 8.27 9.83 10.12 8.90 9.81
Receivables turnover 6.96 7.32 6.84 6.54 6.53
Payables turnover 5.79 6.49 5.01 4.97 5.10
Working capital turnover — — — — —
Average No. Days
Average inventory processing period 44 37 36 41 37
Add: Average receivable collection period 52 50 53 56 56
Operating cycle 96 87 89 97 93
Less: Average payables payment period 63 56 73 73 72
Cash conversion cycle 33 31 16 24 21

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Short-term activity ratio Description The company
Inventory turnover An activity ratio calculated as cost of goods sold divided by inventory. Linde plc inventory turnover ratio deteriorated from 2021 to 2022 and from 2022 to 2023.
Receivables turnover An activity ratio equal to revenue divided by receivables. Linde plc receivables turnover ratio improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023 not reaching 2021 level.
Payables turnover An activity ratio calculated as cost of goods sold divided by payables. Linde plc payables turnover ratio increased from 2021 to 2022 but then slightly decreased from 2022 to 2023.
Short-term activity 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. Linde plc number of days of inventory outstanding deteriorated from 2021 to 2022 and from 2022 to 2023.
Average receivable collection period An activity ratio equal to the number of days in the period divided by receivables turnover. Linde plc number of days of receivables outstanding improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023 not reaching 2021 level.
Operating cycle Equal to average inventory processing period plus average receivables collection period. Linde plc operating cycle improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.
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. Linde plc number of days of payables outstanding decreased from 2021 to 2022 but then slightly increased from 2022 to 2023.
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. Linde plc cash conversion cycle deteriorated from 2021 to 2022 and from 2022 to 2023.

Inventory Turnover

Linde plc, inventory turnover calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Selected Financial Data (US$ in millions)
Cost of sales, exclusive of depreciation and amortization 17,492 19,450 17,543 15,383 16,644
Inventories 2,115 1,978 1,733 1,729 1,697
Short-term Activity Ratio
Inventory turnover1 8.27 9.83 10.12 8.90 9.81
Benchmarks
Inventory Turnover, Industry
Materials 4.05 5.04 5.17 4.87 5.15

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
Inventory turnover = Cost of sales, exclusive of depreciation and amortization ÷ Inventories
= 17,492 ÷ 2,115 = 8.27

Short-term activity ratio Description The company
Inventory turnover An activity ratio calculated as cost of goods sold divided by inventory. Linde plc inventory turnover ratio deteriorated from 2021 to 2022 and from 2022 to 2023.

Receivables Turnover

Linde plc, receivables turnover calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Selected Financial Data (US$ in millions)
Sales 32,854 33,364 30,793 27,243 28,228
Accounts receivable, net 4,718 4,559 4,499 4,167 4,322
Short-term Activity Ratio
Receivables turnover1 6.96 7.32 6.84 6.54 6.53
Benchmarks
Receivables Turnover, Industry
Materials 10.14 10.87 10.97 9.61 9.63

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
Receivables turnover = Sales ÷ Accounts receivable, net
= 32,854 ÷ 4,718 = 6.96

Short-term activity ratio Description The company
Receivables turnover An activity ratio equal to revenue divided by receivables. Linde plc receivables turnover ratio improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023 not reaching 2021 level.

Payables Turnover

Linde plc, payables turnover calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Selected Financial Data (US$ in millions)
Cost of sales, exclusive of depreciation and amortization 17,492 19,450 17,543 15,383 16,644
Accounts payable 3,020 2,995 3,503 3,095 3,266
Short-term Activity Ratio
Payables turnover1 5.79 6.49 5.01 4.97 5.10
Benchmarks
Payables Turnover, Industry
Materials 6.19 6.48 6.11 6.33 6.40

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
Payables turnover = Cost of sales, exclusive of depreciation and amortization ÷ Accounts payable
= 17,492 ÷ 3,020 = 5.79

Short-term activity ratio Description The company
Payables turnover An activity ratio calculated as cost of goods sold divided by payables. Linde plc payables turnover ratio increased from 2021 to 2022 but then slightly decreased from 2022 to 2023.

Working Capital Turnover

Linde plc, working capital turnover calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Selected Financial Data (US$ in millions)
Current assets 12,620 13,047 10,159 10,924 10,352
Less: Current liabilities 15,717 16,479 13,643 13,740 12,160
Working capital (3,097) (3,432) (3,484) (2,816) (1,808)
 
Sales 32,854 33,364 30,793 27,243 28,228
Short-term Activity Ratio
Working capital turnover1 — — — — —
Benchmarks
Working Capital Turnover, Industry
Materials 10.13 7.22 6.27 6.45 7.72

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
Working capital turnover = Sales ÷ Working capital
= 32,854 ÷ -3,097 = —

Average Inventory Processing Period

Linde plc, average inventory processing period calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Selected Financial Data
Inventory turnover 8.27 9.83 10.12 8.90 9.81
Short-term Activity Ratio (no. days)
Average inventory processing period1 44 37 36 41 37
Benchmarks (no. days)
Average Inventory Processing Period, Industry
Materials 90 72 71 75 71

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 8.27 = 44

Short-term activity 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. Linde plc number of days of inventory outstanding deteriorated from 2021 to 2022 and from 2022 to 2023.

Average Receivable Collection Period

Linde plc, average receivable collection period calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Selected Financial Data
Receivables turnover 6.96 7.32 6.84 6.54 6.53
Short-term Activity Ratio (no. days)
Average receivable collection period1 52 50 53 56 56
Benchmarks (no. days)
Average Receivable Collection Period, Industry
Materials 36 34 33 38 38

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 6.96 = 52

Short-term activity ratio Description The company
Average receivable collection period An activity ratio equal to the number of days in the period divided by receivables turnover. Linde plc number of days of receivables outstanding improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023 not reaching 2021 level.

Operating Cycle

Linde plc, operating cycle calculation, comparison to benchmarks

No. days

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Selected Financial Data
Average inventory processing period 44 37 36 41 37
Average receivable collection period 52 50 53 56 56
Short-term Activity Ratio
Operating cycle1 96 87 89 97 93
Benchmarks
Operating Cycle, Industry
Materials 126 106 104 113 109

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= 44 + 52 = 96

Short-term activity ratio Description The company
Operating cycle Equal to average inventory processing period plus average receivables collection period. Linde plc operating cycle improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.

Average Payables Payment Period

Linde plc, average payables payment period calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Selected Financial Data
Payables turnover 5.79 6.49 5.01 4.97 5.10
Short-term Activity Ratio (no. days)
Average payables payment period1 63 56 73 73 72
Benchmarks (no. days)
Average Payables Payment Period, Industry
Materials 59 56 60 58 57

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 5.79 = 63

Short-term activity 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. Linde plc number of days of payables outstanding decreased from 2021 to 2022 but then slightly increased from 2022 to 2023.

Cash Conversion Cycle

Linde plc, cash conversion cycle calculation, comparison to benchmarks

No. days

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Selected Financial Data
Average inventory processing period 44 37 36 41 37
Average receivable collection period 52 50 53 56 56
Average payables payment period 63 56 73 73 72
Short-term Activity Ratio
Cash conversion cycle1 33 31 16 24 21
Benchmarks
Cash Conversion Cycle, Industry
Materials 67 50 44 55 52

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 44 + 52 – 63 = 33

Short-term activity 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. Linde plc cash conversion cycle deteriorated from 2021 to 2022 and from 2022 to 2023.