Analysis of Long-term (Investment) Activity Ratios
Activity ratios measure how efficiently a company performs day-to-day tasks, such us the collection of receivables and management of inventory.
Long-term Activity Ratios (Summary)
Mosaic Co., long-term (investment) activity ratios
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).
The efficiency of long-term asset utilization exhibited a period of volatility between 2017 and 2020, followed by a substantial improvement in 2021 across all measured activity ratios. This indicates a heightened ability to generate revenue from the investment base toward the end of the analyzed period.
- Net Fixed Asset Turnover
- The ratio fluctuated between 0.73 and 0.82 from 2017 through 2020, reflecting inconsistent efficiency in utilizing fixed assets. However, a significant increase to 0.99 was recorded in 2021, marking the highest efficiency level in the observed period. The inclusion of right-of-use assets yielded nearly identical results, suggesting that operating leases had a negligible impact on the overall turnover performance.
- Total Asset Turnover
- A gradual upward trend is observable in the total asset turnover, which rose from 0.40 in 2017 to 0.56 in 2021. While a slight contraction occurred between 2018 and 2020, the overall trajectory indicates a steady improvement in the utilization of the entire asset base to drive sales.
- Equity Turnover
- Equity turnover demonstrated the most consistent growth, increasing from 0.77 in 2017 to a peak of 1.17 in 2021. The transition above the 1.0 threshold in 2021 indicates that the company generated more revenue than the total value of its shareholders' equity during that fiscal year.
The synchronization of peaks in 2021 across all activity ratios suggests a company-wide increase in operational efficiency or a significant surge in revenue that outpaced the growth of the asset and equity bases.
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Net Fixed Asset Turnover
Mosaic Co., net fixed asset turnover calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net sales | 12,357,400) | 8,681,700) | 8,906,300) | 9,587,300) | 7,409,400) | |
| Property, plant and equipment, net | 12,475,300) | 11,854,300) | 11,690,000) | 11,746,500) | 9,711,700) | |
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover1 | 0.99 | 0.73 | 0.76 | 0.82 | 0.76 | |
| Benchmarks | ||||||
| Net Fixed Asset Turnover, Competitors2 | ||||||
| Linde plc | 1.18 | — | — | — | — | |
| Sherwin-Williams Co. | 10.68 | — | — | — | — | |
| Net Fixed Asset Turnover, Sector | ||||||
| Chemicals | 1.81 | — | — | — | — | |
| Net Fixed Asset Turnover, Industry | ||||||
| Materials | 1.27 | — | — | — | — | |
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
Net fixed asset turnover = Net sales ÷ Property, plant and equipment, net
= 12,357,400 ÷ 12,475,300 = 0.99
2 Click competitor name to see calculations.
The net fixed asset turnover ratio exhibited a fluctuating trend between 2017 and 2020, followed by a significant improvement in 2021. This trajectory indicates a period of inconsistent asset utilization efficiency that culminated in a substantial recovery in the final year of the analyzed period.
- Revenue and Asset Dynamics
- Net sales demonstrated volatility, increasing from 7.41 billion in 2017 to 9.59 billion in 2018, before experiencing a gradual decline to 8.68 billion by 2020. During this same timeframe, net property, plant, and equipment grew from 9.71 billion to 11.85 billion. The expansion of the fixed asset base during a period of stagnating or declining sales between 2018 and 2020 contributed to the compression of the turnover ratio from 0.82 to a low of 0.73.
- Asset Utilization Efficiency
- The operational efficiency of long-term assets reached a five-year peak in 2021, with the net fixed asset turnover ratio rising to 0.99. This improvement was driven by a sharp increase in net sales to 12.36 billion, which far outpaced the modest increase in net property, plant, and equipment to 12.48 billion. This suggests a significant optimization of existing capacity or a highly favorable market environment that allowed for greater revenue generation per unit of fixed investment.
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Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset)
Mosaic Co., net fixed asset turnover (including operating lease, right-of-use asset) calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net sales | 12,357,400) | 8,681,700) | 8,906,300) | 9,587,300) | 7,409,400) | |
| Property, plant and equipment, net | 12,475,300) | 11,854,300) | 11,690,000) | 11,746,500) | 9,711,700) | |
| Operating lease right-of-use assets | 120,200) | 173,100) | 192,100) | —) | —) | |
| Property, plant and equipment, net (including operating lease, right-of-use asset) | 12,595,500) | 12,027,400) | 11,882,100) | 11,746,500) | 9,711,700) | |
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover (including operating lease, right-of-use asset)1 | 0.98 | 0.72 | 0.75 | 0.82 | 0.76 | |
| Benchmarks | ||||||
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Competitors2 | ||||||
| Linde plc | 1.14 | — | — | — | — | |
| Sherwin-Williams Co. | 5.41 | — | — | — | — | |
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Sector | ||||||
| Chemicals | 1.65 | — | — | — | — | |
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Industry | ||||||
| Materials | 1.21 | — | — | — | — | |
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
Net fixed asset turnover (including operating lease, right-of-use asset) = Net sales ÷ Property, plant and equipment, net (including operating lease, right-of-use asset)
= 12,357,400 ÷ 12,595,500 = 0.98
2 Click competitor name to see calculations.
The analysis of long-term activity ratios between 2017 and 2021 reveals a fluctuating efficiency in the utilization of fixed assets to generate revenue. While investments in property, plant, and equipment grew steadily throughout the period, net sales exhibited significant volatility, which directly impacted the net fixed asset turnover ratio.
- Net Sales Trends
- Net sales experienced an initial increase in 2018, followed by a two-year contraction through 2020. A substantial recovery occurred in 2021, with sales reaching 12,357,400 thousand US dollars, the highest level within the observed five-year period.
- Fixed Asset Investment
- Property, plant, and equipment, including right-of-use assets, maintained a consistent upward trajectory. The net value increased from 9,711,700 thousand US dollars in 2017 to 12,595,500 thousand US dollars by 2021, reflecting a continuous expansion of the long-term asset base.
- Net Fixed Asset Turnover Performance
- The turnover ratio reached its peak of 0.98 in 2021, indicating a significant improvement in asset productivity. Prior to this, the ratio declined from 0.82 in 2018 to a low of 0.72 in 2020. This downward trend occurred because net sales decreased while the fixed asset base continued to grow, suggesting a period of diminished capacity utilization. The sharp increase in 2021 demonstrates that revenue growth significantly outpaced the incremental increase in fixed assets, resulting in enhanced operational efficiency.
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Total Asset Turnover
Mosaic Co., total asset turnover calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net sales | 12,357,400) | 8,681,700) | 8,906,300) | 9,587,300) | 7,409,400) | |
| Total assets | 22,036,400) | 19,789,800) | 19,298,500) | 20,119,200) | 18,633,400) | |
| Long-term Activity Ratio | ||||||
| Total asset turnover1 | 0.56 | 0.44 | 0.46 | 0.48 | 0.40 | |
| Benchmarks | ||||||
| Total Asset Turnover, Competitors2 | ||||||
| Linde plc | 0.38 | — | — | — | — | |
| Sherwin-Williams Co. | 0.97 | — | — | — | — | |
| Total Asset Turnover, Sector | ||||||
| Chemicals | 0.50 | — | — | — | — | |
| Total Asset Turnover, Industry | ||||||
| Materials | 0.49 | — | — | — | — | |
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
Total asset turnover = Net sales ÷ Total assets
= 12,357,400 ÷ 22,036,400 = 0.56
2 Click competitor name to see calculations.
An analysis of the investment activity ratios from 2017 to 2021 reveals a general improvement in asset utilization efficiency, culminating in a five-year peak in 2021. While the asset base grew steadily, revenue growth exhibited more volatility, which directly influenced the fluctuations in the total asset turnover ratio.
- Net Sales Performance
- Revenue demonstrated significant growth from US$ 7.4 billion in 2017 to US$ 9.6 billion in 2018. A period of moderate contraction and stagnation followed between 2019 and 2020, with sales declining to US$ 8.7 billion. This trend reversed sharply in 2021, with net sales increasing to US$ 12.4 billion, representing the highest revenue volume in the observed period.
- Total Asset Base Evolution
- The total asset base showed a consistent and gradual upward trajectory, expanding from US$ 18.6 billion in 2017 to US$ 22.0 billion by the end of 2021. This steady growth indicates a sustained increase in the company's resource investments over the five-year span.
- Total Asset Turnover Efficiency
- The efficiency of asset utilization increased from a ratio of 0.40 in 2017 to 0.48 in 2018. A slight downward trend occurred over the following two years, with the ratio retreating to 0.46 in 2019 and 0.44 in 2020. A significant recovery was recorded in 2021, as the ratio reached 0.56. This peak indicates that the substantial increase in net sales during 2021 outpaced the growth of the asset base, resulting in a marked improvement in the company's ability to generate revenue from its investments.
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Equity Turnover
Mosaic Co., equity turnover calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net sales | 12,357,400) | 8,681,700) | 8,906,300) | 9,587,300) | 7,409,400) | |
| Total Mosaic stockholders’ equity | 10,604,100) | 9,581,400) | 9,185,500) | 10,397,300) | 9,617,500) | |
| Long-term Activity Ratio | ||||||
| Equity turnover1 | 1.17 | 0.91 | 0.97 | 0.92 | 0.77 | |
| Benchmarks | ||||||
| Equity Turnover, Competitors2 | ||||||
| Linde plc | 0.70 | — | — | — | — | |
| Sherwin-Williams Co. | 8.18 | — | — | — | — | |
| Equity Turnover, Sector | ||||||
| Chemicals | 1.09 | — | — | — | — | |
| Equity Turnover, Industry | ||||||
| Materials | 1.22 | — | — | — | — | |
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
Equity turnover = Net sales ÷ Total Mosaic stockholders’ equity
= 12,357,400 ÷ 10,604,100 = 1.17
2 Click competitor name to see calculations.
The analysis of long-term investment activity reveals a general upward trajectory in asset utilization efficiency between 2017 and 2021. There is a discernible correlation between the growth in net sales and the improvement of the equity turnover ratio, indicating an enhanced ability to generate revenue relative to the shareholders' investment.
- Net Sales Performance
- Net sales demonstrated significant volatility over the five-year period. An initial increase from $7.41 billion in 2017 to $9.59 billion in 2018 was followed by a moderate decline, with sales dipping to $8.68 billion by 2020. However, a substantial surge occurred in 2021, with net sales reaching a peak of $12.36 billion.
- Stockholders' Equity Stability
- Total stockholders' equity remained relatively stable, fluctuating between a low of $9.19 billion in 2019 and a high of $10.60 billion in 2021. The equity base experienced a contraction in 2019, which contributed to a temporary increase in turnover efficiency despite falling sales.
- Equity Turnover Efficiency
- The equity turnover ratio improved from 0.77 in 2017 to 1.17 in 2021. The ratio climbed steadily to 0.97 by 2019, experienced a slight regression to 0.91 in 2020, and then rose sharply in 2021. The breach of the 1.0 threshold in 2021 signifies a critical shift in operational efficiency, where the company generated sales exceeding the total value of its equity base for the first time in the analyzed period.
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