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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- Statement of Comprehensive Income
- Balance Sheet: Assets
- Analysis of Profitability Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Analysis of Reportable Segments
- Analysis of Geographic Areas
- Enterprise Value to FCFF (EV/FCFF)
- Capital Asset Pricing Model (CAPM)
- Total Asset Turnover since 2005
- Analysis of Revenues
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Short-term Activity Ratios (Summary)
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
- Inventory Turnover
- The inventory turnover ratio exhibited a fluctuating pattern over the observed period, starting at 34.71 in 2017 and peaking at 70.32 in 2019 before declining to 40.75 in 2020 and increasing again to 72.74 in 2021. This indicates varying efficiency in inventory management, with particularly strong turnover in 2019 and 2021.
- Receivables Turnover
- The receivables turnover ratio improved from 4.04 in 2017 to a high of 5.47 in 2018 but then declined to 4.51 in 2019 and remained relatively steady around 4.15 to 4.9 in the subsequent years. This suggests a slight deterioration in collection efficiency after 2018, although the ratio remained above the 2017 level by 2021.
- Payables Turnover
- Payables turnover showed an upward trend from 3.13 in 2017 to 5.05 by 2021, with some variability mid-period. This indicates an increasing pace in settling payables over time, culminating in more frequent payments in 2021.
- Working Capital Turnover
- The working capital turnover ratio demonstrated significant variability, initially decreasing from 7.31 in 2017 to 5.42 in 2018, then sharply rising to 12.98 in 2019, followed by a decline to 7.76 in 2020 and a substantial jump to 30.44 in 2021. The marked increase in 2021 reflects enhanced efficiency in utilizing working capital to generate revenue.
- Average Inventory Processing Period
- The average inventory processing period decreased from 11 days in 2017 to 5 days in 2019, indicating faster inventory turnover, then spiked to 9 days in 2020 before returning to 5 days in 2021. Overall, the data suggests improvements in inventory handling speed despite a temporary slowdown in 2020.
- Average Receivable Collection Period
- This period shortened significantly from 90 days in 2017 to 67 days in 2018, then lengthened gradually to 88 days in 2020 before declining again to 74 days in 2021. While 2021 levels remain higher than in 2018, the trend suggests some challenges in collection efficiency following initial improvement.
- Operating Cycle
- The operating cycle shortened from 101 days in 2017 to 73 days in 2018 but then trended upwards to 97 days in 2020 before decreasing again to 79 days in 2021. This reflects variability in the combined inventory and receivables turnover over time, with 2021 showing a more efficient operating cycle compared to 2017.
- Average Payables Payment Period
- The average payables payment period declined from 116 days in 2017 to 72 days in 2021, with intermediate fluctuations. This suggests a trend toward quicker payment to suppliers over the period, potentially improving supplier relationships or reflecting changes in credit terms.
- Cash Conversion Cycle
- The cash conversion cycle was negative in all years from 2017 through 2020, improving from -15 days in 2017 to -2 days in 2020, before turning positive at 7 days in 2021. The negative values initially indicate that the company was able to collect cash from operations faster than it paid its suppliers, but the shift to a positive cycle in 2021 suggests a change in this dynamic, potentially indicating tighter working capital management or shifts in payment and collection cycles.
Turnover Ratios
Average No. Days
Inventory Turnover
Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
---|---|---|---|---|---|---|
Selected Financial Data (US$ in millions) | ||||||
Revenues from contracts with customers | ||||||
Inventories | ||||||
Short-term Activity Ratio | ||||||
Inventory turnover1 | ||||||
Benchmarks | ||||||
Inventory Turnover, Competitors2 | ||||||
Chevron Corp. | ||||||
ConocoPhillips | ||||||
Exxon Mobil Corp. | ||||||
Occidental Petroleum Corp. | ||||||
Inventory Turnover, Sector | ||||||
Oil, Gas & Consumable Fuels | ||||||
Inventory Turnover, Industry | ||||||
Energy |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Inventory turnover = Revenues from contracts with customers ÷ Inventories
= ÷ =
2 Click competitor name to see calculations.
- Revenues from contracts with customers
- The revenue figures exhibit notable fluctuations over the five-year period. From 2017 to 2018, revenues increased significantly, reaching a peak in 2018. The subsequent year, 2019, saw a decline, followed by a sharp decrease in 2020, which likely reflected external economic pressures. In 2021, revenues rebounded, nearing but not fully reaching the peak observed in 2018.
- Inventories
- Inventories displayed a clear downward trend from 2017 through 2019, decreasing steadily each year. This decrease halted in 2020, where inventory levels remained roughly stable compared to 2019. In 2021, inventory levels showed a marginal increase, suggesting possible adjustments in supply chain or stock management strategies.
- Inventory turnover
- Inventory turnover ratios fluctuated substantially throughout the observed period. The ratio rose sharply from 2017 to 2018 and continued to increase in 2019, indicating an improvement in inventory management efficiency or faster movement of inventory. However, in 2020, the ratio dropped significantly, likely reflecting slower sales or excess inventory during that year. This trend reversed in 2021, with the turnover ratio climbing back to previous high levels, implying a return to more efficient inventory utilization.
Receivables Turnover
Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
---|---|---|---|---|---|---|
Selected Financial Data (US$ in millions) | ||||||
Revenues | ||||||
Receivables, less reserve | ||||||
Short-term Activity Ratio | ||||||
Receivables turnover1 | ||||||
Benchmarks | ||||||
Receivables Turnover, Competitors2 | ||||||
Chevron Corp. | ||||||
ConocoPhillips | ||||||
Exxon Mobil Corp. | ||||||
Occidental Petroleum Corp. | ||||||
Receivables Turnover, Sector | ||||||
Oil, Gas & Consumable Fuels | ||||||
Receivables Turnover, Industry | ||||||
Energy |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Receivables turnover = Revenues ÷ Receivables, less reserve
= ÷ =
2 Click competitor name to see calculations.
The financial data reveals several important trends and changes over the five-year period ending December 31, 2021.
- Revenues
- Revenues experienced notable fluctuations during the period. There was a substantial increase from 2017 to 2018, rising from $4,373 million to $5,902 million. This was followed by a decline in 2019 to $5,063 million and a more pronounced drop in 2020 to $3,097 million. However, the revenues rebounded sharply in 2021, reaching $5,601 million, nearly recovering to the 2018 level. The decline in 2020 likely reflects an adverse market or operational environment, while the recovery in 2021 suggests improvement in business conditions or market demand.
- Receivables, less reserve
- The amount of receivables (net of reserves) showed a relatively stable pattern initially, with minor fluctuations between 2017 and 2019, ranging from $1,082 million to $1,122 million. A significant decrease to $747 million occurred in 2020, which corresponds with the revenue decline in the same year, potentially indicating tighter credit or collection policies or reduced sales on credit. In 2021, receivables increased considerably to $1,142 million, surpassing previous years, aligning with the revenue recovery.
- Receivables turnover ratio
- The receivables turnover ratio, which measures how efficiently the company collects its receivables, exhibited an improving trend from 2017 to 2018, increasing from 4.04 to 5.47, suggesting faster collection. This ratio declined in subsequent years, reaching 4.15 in 2020 during the downturn, indicating slower collection relative to sales. In 2021, the ratio improved again to 4.9, reflecting better collection efficiency amid recovering revenues.
Overall, the data reflect a pronounced impact on business performance in 2020, likely due to external challenges affecting sales and collections. The subsequent recovery in 2021 is evident across revenues, receivables, and collection efficiency, suggesting the company's operations improved following the downturn. The movements in receivables and turnover ratio corroborate the revenue trends, highlighting an interrelationship between sales volume and working capital management during the period.
Payables Turnover
Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
---|---|---|---|---|---|---|
Selected Financial Data (US$ in millions) | ||||||
Revenues from contracts with customers | ||||||
Accounts payable | ||||||
Short-term Activity Ratio | ||||||
Payables turnover1 | ||||||
Benchmarks | ||||||
Payables Turnover, Competitors2 | ||||||
Chevron Corp. | ||||||
ConocoPhillips | ||||||
Exxon Mobil Corp. | ||||||
Occidental Petroleum Corp. | ||||||
Payables Turnover, Sector | ||||||
Oil, Gas & Consumable Fuels | ||||||
Payables Turnover, Industry | ||||||
Energy |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Payables turnover = Revenues from contracts with customers ÷ Accounts payable
= ÷ =
2 Click competitor name to see calculations.
- Revenues from contracts with customers
- The revenue figures demonstrate a fluctuating trend over the five-year period. Starting at 4,373 million USD in 2017, there was a notable increase to 5,902 million USD in 2018, followed by a decline to 5,063 million USD in 2019. A significant drop occurred in 2020, with revenues falling sharply to 3,097 million USD, likely indicative of external economic pressures during that year. The revenue rebounded in 2021 to 5,601 million USD, approaching pre-2020 levels.
- Accounts payable
- Accounts payable shows a general decreasing trend from 1,395 million USD in 2017 to 1,307 million USD in 2019, with a steeper decline in 2020 to 837 million USD. However, in 2021, accounts payable increased to 1,110 million USD, indicating a partial recovery or increased short-term obligations relative to the previous year.
- Payables turnover
- The payables turnover ratio indicates how efficiently the company is settling its payables. There is an overall increasing trend notable from 3.13 in 2017 to 5.05 in 2021. The ratio peaked in 2018 at 4.47, dipped slightly in 2019 and 2020 to 3.87 and 3.7 respectively, before rising again sharply in 2021. The higher ratio in 2021 suggests improved efficiency in paying off accounts payable compared to most prior years, possibly reflecting stronger cash management or supplier payment policies.
Working Capital Turnover
Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
---|---|---|---|---|---|---|
Selected Financial Data (US$ in millions) | ||||||
Current assets | ||||||
Less: Current liabilities | ||||||
Working capital | ||||||
Revenues | ||||||
Short-term Activity Ratio | ||||||
Working capital turnover1 | ||||||
Benchmarks | ||||||
Working Capital Turnover, Competitors2 | ||||||
Chevron Corp. | ||||||
ConocoPhillips | ||||||
Exxon Mobil Corp. | ||||||
Occidental Petroleum Corp. | ||||||
Working Capital Turnover, Sector | ||||||
Oil, Gas & Consumable Fuels | ||||||
Working Capital Turnover, Industry | ||||||
Energy |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Working capital turnover = Revenues ÷ Working capital
= ÷ =
2 Click competitor name to see calculations.
- Working Capital
- The working capital shows a fluctuating trend over the five-year period. It started at 598 million USD in 2017 and increased to a peak of 1,089 million USD in 2018. However, it then experienced a significant decline to 390 million USD in 2019, followed by a slight increase to 399 million USD in 2020. In 2021, the working capital further decreased to 184 million USD, reaching its lowest point in the period analyzed.
- Revenues
- Revenues demonstrated volatility throughout the years. After rising from 4,373 million USD in 2017 to a high of 5,902 million USD in 2018, revenues decreased to 5,063 million USD in 2019. A sharp decline occurred in 2020 with revenues dropping to 3,097 million USD, likely reflecting external adverse conditions. Subsequently, revenues rebounded significantly to 5,601 million USD in 2021, approaching levels seen in earlier high-revenue years.
- Working Capital Turnover
- The working capital turnover ratio exhibited considerable variation. It declined from 7.31 in 2017 to 5.42 in 2018, indicating slower revenue generation relative to working capital during that year. In 2019, this ratio more than doubled to 12.98, which may reflect increased efficiency or reduced working capital levels. The ratio then decreased again in 2020 to 7.76 before sharply increasing to 30.44 in 2021. The exceptionally high turnover in 2021 suggests a significant increase in revenue relative to working capital, possibly due to the markedly reduced working capital balance combined with strong revenue recovery.
Average Inventory Processing Period
Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
---|---|---|---|---|---|---|
Selected Financial Data | ||||||
Inventory turnover | ||||||
Short-term Activity Ratio (no. days) | ||||||
Average inventory processing period1 | ||||||
Benchmarks (no. days) | ||||||
Average Inventory Processing Period, Competitors2 | ||||||
Chevron Corp. | ||||||
ConocoPhillips | ||||||
Exxon Mobil Corp. | ||||||
Occidental Petroleum Corp. | ||||||
Average Inventory Processing Period, Sector | ||||||
Oil, Gas & Consumable Fuels | ||||||
Average Inventory Processing Period, Industry | ||||||
Energy |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ =
2 Click competitor name to see calculations.
- Inventory Turnover
- The inventory turnover ratio displayed noticeable fluctuations over the examined period. Starting at 34.71 in 2017, it nearly doubled to 61.48 in 2018, followed by a further increase to 70.32 in 2019, indicating improved inventory management and faster stock movement during these years. However, in 2020, there was a significant decline to 40.75, suggesting a slowdown or buildup of inventory. This trend reversed sharply in 2021 as the turnover ratio surged to 72.74, reaching the highest point in the period and reflecting an efficient reduction in inventory levels or increased sales activity.
- Average Inventory Processing Period
- The average inventory processing period inversely mirrored the pattern of inventory turnover. Initially, it was 11 days in 2017 and decreased substantially to 6 days in 2018 and further to 5 days in 2019, which aligns with the rising turnover ratios and indicates a quicker conversion of inventory to sales. In 2020, the processing period lengthened to 9 days, consistent with the decrease in turnover, reflecting slower inventory movement during that year. By 2021, the period shortened again to 5 days, indicating a return to efficient inventory management and faster processing times.
- Overall Trend Insights
- The data reveals a general improvement in inventory management efficiency from 2017 through 2019, evidenced by increasing turnover ratios and decreasing inventory days. The dip in 2020 suggests an interruption, potentially due to external factors affecting sales or supply chain dynamics, resulting in slower inventory movement. The strong recovery in 2021 signifies a return to operational effectiveness and possibly an adaptive response to previous disruptions. The inverse relationship between inventory turnover and processing period is consistent throughout, validating the reliability of the observed patterns.
Average Receivable Collection Period
Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
---|---|---|---|---|---|---|
Selected Financial Data | ||||||
Receivables turnover | ||||||
Short-term Activity Ratio (no. days) | ||||||
Average receivable collection period1 | ||||||
Benchmarks (no. days) | ||||||
Average Receivable Collection Period, Competitors2 | ||||||
Chevron Corp. | ||||||
ConocoPhillips | ||||||
Exxon Mobil Corp. | ||||||
Occidental Petroleum Corp. | ||||||
Average Receivable Collection Period, Sector | ||||||
Oil, Gas & Consumable Fuels | ||||||
Average Receivable Collection Period, Industry | ||||||
Energy |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ =
2 Click competitor name to see calculations.
- Receivables Turnover
- The receivables turnover ratio exhibited variation over the five-year period. Starting at 4.04 in 2017, it increased significantly to 5.47 in 2018, indicating improved efficiency in collecting receivables that year. However, it then declined to 4.51 in 2019 and further to 4.15 in 2020, suggesting a gradual slowdown in collection efficiency. In 2021, there was a partial recovery with the turnover rising again to 4.9. Overall, the trend shows fluctuations with a peak in 2018, a dip over the next two years, and a rebound in the final year.
- Average Receivable Collection Period
- The average collection period in days reflected an inverse relationship to the receivables turnover, consistent with financial theory. It decreased from 90 days in 2017 to 67 days in 2018, indicating faster collection of outstanding receivables. After that, the period increased to 81 days in 2019 and 88 days in 2020, signaling slower collection times. In 2021, the collection period shortened again to 74 days. These changes correspond with the patterns seen in the turnover ratio and reflect fluctuations in credit management and liquidity over time.
- Overall Insights
- The data indicates periods of both improvement and decline in receivables management. The improvement in 2018 suggests effective collection processes or favorable customer payment behavior during that year, while the decline during 2019 and 2020 may point to challenges in receivables collection, possibly related to external economic conditions or internal operational issues. The partial recovery in 2021 suggests measures may have been taken to enhance collection efficiency or the external environment became more favorable again. Monitoring these metrics remains vital for managing working capital and cash flow effectively.
Operating Cycle
Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
---|---|---|---|---|---|---|
Selected Financial Data | ||||||
Average inventory processing period | ||||||
Average receivable collection period | ||||||
Short-term Activity Ratio | ||||||
Operating cycle1 | ||||||
Benchmarks | ||||||
Operating Cycle, Competitors2 | ||||||
Chevron Corp. | ||||||
ConocoPhillips | ||||||
Exxon Mobil Corp. | ||||||
Occidental Petroleum Corp. | ||||||
Operating Cycle, Sector | ||||||
Oil, Gas & Consumable Fuels | ||||||
Operating Cycle, Industry | ||||||
Energy |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= + =
2 Click competitor name to see calculations.
- Average Inventory Processing Period
- The average inventory processing period exhibits a fluctuating trend over the five-year span. Beginning at 11 days in 2017, it sharply declined to 6 days in 2018 and further to 5 days in 2019. However, there was a noticeable increase to 9 days in 2020, followed again by a reduction to 5 days in 2021. This pattern suggests intermittent variations in inventory management efficiency, with an overall reduction from the starting point.
- Average Receivable Collection Period
- The average receivable collection period shows variability without a consistent upward or downward trend. It started at 90 days in 2017 and improved significantly to 67 days in 2018, indicating faster collection. This was followed by a deterioration to 81 days in 2019, a slight increase to 88 days in 2020, before improving again to 74 days in 2021. These fluctuations could reflect changing credit policies or variations in customer payment behaviors.
- Operating Cycle
- The operating cycle, comprising both inventory processing and receivable collection periods, mirrors the patterns observed in its components. It decreased markedly from 101 days in 2017 to 73 days in 2018, followed by an increase to 86 days in 2019. The cycle extended further to 97 days in 2020, before reducing again to 79 days in 2021. This indicates an overall improvement in the efficiency of converting raw materials to cash, despite intermittent disruptions during the period analyzed.
Average Payables Payment Period
Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
---|---|---|---|---|---|---|
Selected Financial Data | ||||||
Payables turnover | ||||||
Short-term Activity Ratio (no. days) | ||||||
Average payables payment period1 | ||||||
Benchmarks (no. days) | ||||||
Average Payables Payment Period, Competitors2 | ||||||
Chevron Corp. | ||||||
ConocoPhillips | ||||||
Exxon Mobil Corp. | ||||||
Occidental Petroleum Corp. | ||||||
Average Payables Payment Period, Sector | ||||||
Oil, Gas & Consumable Fuels | ||||||
Average Payables Payment Period, Industry | ||||||
Energy |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ =
2 Click competitor name to see calculations.
- Payables Turnover
- The payables turnover ratio exhibits variability over the five-year period, starting at 3.13 in 2017 and increasing to 4.47 in 2018. It then declines to 3.87 in 2019 and slightly decreases again to 3.7 in 2020 before rising significantly to 5.05 in 2021. This pattern suggests a fluctuating but overall improving efficiency in paying off suppliers, with the highest turnover observed in 2021 indicating faster payment cycles or reduced outstanding payables relative to purchases during that year.
- Average Payables Payment Period
- The average payables payment period demonstrates an inverse trend compared to the payables turnover. It begins at 116 days in 2017 and shortens sharply to 82 days in 2018. Subsequently, it increases to 94 days in 2019 and further to 99 days in 2020 before dropping to the lowest point of 72 days in 2021. This decline in the payment period in 2021 suggests an acceleration in supplier payments after a period of relative lengthening from 2018 to 2020.
- Overall Analysis
- There is a clear inverse relationship between the payables turnover and the average payables payment period across these years, reflecting consistent accounting for the duration it takes the company to pay suppliers. The notable improvement in payables turnover and the concurrent decrease in payment period in 2021 may indicate enhanced liquidity or a strategic shift to quicker payments, potentially to negotiate better terms or strengthen supplier relationships. The fluctuations observed between 2018 and 2020 may reflect operational or market conditions affecting the company's cash management or procurement practices during that timeframe.
Cash Conversion Cycle
Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
---|---|---|---|---|---|---|
Selected Financial Data | ||||||
Average inventory processing period | ||||||
Average receivable collection period | ||||||
Average payables payment period | ||||||
Short-term Activity Ratio | ||||||
Cash conversion cycle1 | ||||||
Benchmarks | ||||||
Cash Conversion Cycle, Competitors2 | ||||||
Chevron Corp. | ||||||
ConocoPhillips | ||||||
Exxon Mobil Corp. | ||||||
Occidental Petroleum Corp. | ||||||
Cash Conversion Cycle, Sector | ||||||
Oil, Gas & Consumable Fuels | ||||||
Cash Conversion Cycle, Industry | ||||||
Energy |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= + – =
2 Click competitor name to see calculations.
- Average Inventory Processing Period
- The average inventory processing period showed a general decline from 11 days in 2017 to 5 days in 2019, indicating improved efficiency in inventory turnover during this period. However, there was a notable increase to 9 days in 2020 before returning to 5 days in 2021, suggesting temporary operational challenges or fluctuations in inventory management during 2020.
- Average Receivable Collection Period
- The average receivable collection period decreased significantly from 90 days in 2017 to 67 days in 2018, reflecting improved collection efficiency. Subsequently, it increased to 81 days in 2019 and further to 88 days in 2020, indicating some difficulties in receivables management during these years. In 2021, it improved again to 74 days, showing a partial recovery in collection performance.
- Average Payables Payment Period
- The average payables payment period experienced a substantial reduction from 116 days in 2017 to 82 days in 2018, suggesting a quicker settlement of obligations. This was followed by an increase to 94 days in 2019 and 99 days in 2020, indicating a tendency to extend payment terms during this period. In 2021, the period shortened significantly to 72 days, reflecting a stricter payment policy or improved cash flow management.
- Cash Conversion Cycle
- The cash conversion cycle was negative from 2017 through 2020, starting at -15 days in 2017 and moving closer to zero with -9 days in 2018, -8 days in 2019, and -2 days in 2020. This negative cycle suggests the company was able to finance its inventory and receivables through payables effectively during these years. However, in 2021, the cash conversion cycle turned positive at 7 days, indicating a shift where more capital is tied up in operations for a longer period, potentially reflecting changes in operational or payment dynamics.