Analysis of Short-term (Operating) Activity Ratios
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)
YUM! Brands Inc., short-term (operating) activity ratios
Based on: 10-K (reporting date: 2015-12-26), 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29), 10-K (reporting date: 2011-12-31).
| Short-term activity ratio | Description | The company |
|---|---|---|
| Inventory turnover | An activity ratio calculated as cost of goods sold divided by inventory. | YUM! Brands Inc. inventory turnover ratio deteriorated from 2013 to 2014 but then improved from 2014 to 2015 exceeding 2013 level. |
| Receivables turnover | An activity ratio equal to revenue divided by receivables. | YUM! Brands Inc. receivables turnover ratio deteriorated from 2013 to 2014 and from 2014 to 2015. |
| Payables turnover | An activity ratio calculated as cost of goods sold divided by payables. | YUM! Brands Inc. payables turnover ratio increased from 2013 to 2014 and from 2014 to 2015. |
| 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. | |
| Average receivable collection period | An activity ratio equal to the number of days in the period divided by receivables turnover. | |
| Operating cycle | Equal to average inventory processing period plus average receivables collection period. | |
| 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. | YUM! Brands Inc. number of days of payables outstanding decreased from 2013 to 2014 and from 2014 to 2015. |
| 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. | YUM! Brands Inc. cash conversion cycle deteriorated from 2013 to 2014 and from 2014 to 2015. |
Inventory Turnover
YUM! Brands Inc., inventory turnover calculation, comparison to benchmarks
| Dec 26, 2015 | Dec 27, 2014 | Dec 28, 2013 | Dec 29, 2012 | Dec 31, 2011 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Company restaurant expenses | 9,359) | 9,682) | 9,501) | 9,852) | 9,140) | |
| Inventories | 229) | 301) | 294) | 313) | 273) | |
| Short-term Activity Ratio | ||||||
| Inventory turnover1 | 40.87 | 32.17 | 32.32 | 31.48 | 33.48 | |
| Benchmarks | ||||||
| Inventory Turnover, Competitors2 | ||||||
| Carnival Corp. & plc | — | — | — | — | — | |
| Chipotle Mexican Grill Inc. | — | — | — | — | — | |
| McDonald’s Corp. | — | — | — | — | — | |
| Starbucks Corp. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2015-12-26), 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29), 10-K (reporting date: 2011-12-31).
1 2015 Calculation
Inventory turnover = Company restaurant expenses ÷ Inventories
= 9,359 ÷ 229 = 40.87
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Inventory turnover | An activity ratio calculated as cost of goods sold divided by inventory. | YUM! Brands Inc. inventory turnover ratio deteriorated from 2013 to 2014 but then improved from 2014 to 2015 exceeding 2013 level. |
Receivables Turnover
YUM! Brands Inc., receivables turnover calculation, comparison to benchmarks
| Dec 26, 2015 | Dec 27, 2014 | Dec 28, 2013 | Dec 29, 2012 | Dec 31, 2011 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Company sales | 11,145) | 11,324) | 11,184) | 11,833) | 10,893) | |
| Accounts and notes receivable, net | 377) | 325) | 319) | 301) | 286) | |
| Short-term Activity Ratio | ||||||
| Receivables turnover1 | 29.56 | 34.84 | 35.06 | 39.31 | 38.09 | |
| Benchmarks | ||||||
| Receivables Turnover, Competitors2 | ||||||
| Airbnb Inc. | — | — | — | — | — | |
| Booking Holdings Inc. | — | — | — | — | — | |
| Carnival Corp. & plc | — | — | — | — | — | |
| Chipotle Mexican Grill Inc. | — | — | — | — | — | |
| McDonald’s Corp. | — | — | — | — | — | |
| Starbucks Corp. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2015-12-26), 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29), 10-K (reporting date: 2011-12-31).
1 2015 Calculation
Receivables turnover = Company sales ÷ Accounts and notes receivable, net
= 11,145 ÷ 377 = 29.56
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Receivables turnover | An activity ratio equal to revenue divided by receivables. | YUM! Brands Inc. receivables turnover ratio deteriorated from 2013 to 2014 and from 2014 to 2015. |
Payables Turnover
YUM! Brands Inc., payables turnover calculation, comparison to benchmarks
| Dec 26, 2015 | Dec 27, 2014 | Dec 28, 2013 | Dec 29, 2012 | Dec 31, 2011 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Company restaurant expenses | 9,359) | 9,682) | 9,501) | 9,852) | 9,140) | |
| Accounts payable | 616) | 694) | 704) | 684) | 712) | |
| Short-term Activity Ratio | ||||||
| Payables turnover1 | 15.19 | 13.95 | 13.50 | 14.40 | 12.84 | |
| Benchmarks | ||||||
| Payables Turnover, Competitors2 | ||||||
| Airbnb Inc. | — | — | — | — | — | |
| Booking Holdings Inc. | — | — | — | — | — | |
| Carnival Corp. & plc | — | — | — | — | — | |
| Chipotle Mexican Grill Inc. | — | — | — | — | — | |
| McDonald’s Corp. | — | — | — | — | — | |
| Starbucks Corp. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2015-12-26), 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29), 10-K (reporting date: 2011-12-31).
1 2015 Calculation
Payables turnover = Company restaurant expenses ÷ Accounts payable
= 9,359 ÷ 616 = 15.19
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Payables turnover | An activity ratio calculated as cost of goods sold divided by payables. | YUM! Brands Inc. payables turnover ratio increased from 2013 to 2014 and from 2014 to 2015. |
Working Capital Turnover
YUM! Brands Inc., working capital turnover calculation, comparison to benchmarks
| Dec 26, 2015 | Dec 27, 2014 | Dec 28, 2013 | Dec 29, 2012 | Dec 31, 2011 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current assets | 1,688) | 1,646) | 1,691) | 1,909) | 2,321) | |
| Less: Current liabilities | 3,088) | 2,411) | 2,265) | 2,188) | 2,450) | |
| Working capital | (1,400) | (765) | (574) | (279) | (129) | |
| Company sales | 11,145) | 11,324) | 11,184) | 11,833) | 10,893) | |
| Short-term Activity Ratio | ||||||
| Working capital turnover1 | — | — | — | — | — | |
| Benchmarks | ||||||
| Working Capital Turnover, Competitors2 | ||||||
| Airbnb Inc. | — | — | — | — | — | |
| Booking Holdings Inc. | — | — | — | — | — | |
| Carnival Corp. & plc | — | — | — | — | — | |
| Chipotle Mexican Grill Inc. | — | — | — | — | — | |
| McDonald’s Corp. | — | — | — | — | — | |
| Starbucks Corp. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2015-12-26), 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29), 10-K (reporting date: 2011-12-31).
1 2015 Calculation
Working capital turnover = Company sales ÷ Working capital
= 11,145 ÷ -1,400 = —
2 Click competitor name to see calculations.
Average Inventory Processing Period
YUM! Brands Inc., average inventory processing period calculation, comparison to benchmarks
| Dec 26, 2015 | Dec 27, 2014 | Dec 28, 2013 | Dec 29, 2012 | Dec 31, 2011 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Inventory turnover | 40.87 | 32.17 | 32.32 | 31.48 | 33.48 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average inventory processing period1 | 9 | 11 | 11 | 12 | 11 | |
| Benchmarks (no. days) | ||||||
| Average Inventory Processing Period, Competitors2 | ||||||
| Carnival Corp. & plc | — | — | — | — | — | |
| Chipotle Mexican Grill Inc. | — | — | — | — | — | |
| McDonald’s Corp. | — | — | — | — | — | |
| Starbucks Corp. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2015-12-26), 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29), 10-K (reporting date: 2011-12-31).
1 2015 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 40.87 = 9
2 Click competitor name to see calculations.
| 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. |
Average Receivable Collection Period
YUM! Brands Inc., average receivable collection period calculation, comparison to benchmarks
| Dec 26, 2015 | Dec 27, 2014 | Dec 28, 2013 | Dec 29, 2012 | Dec 31, 2011 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Receivables turnover | 29.56 | 34.84 | 35.06 | 39.31 | 38.09 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average receivable collection period1 | 12 | 10 | 10 | 9 | 10 | |
| Benchmarks (no. days) | ||||||
| Average Receivable Collection Period, Competitors2 | ||||||
| Airbnb Inc. | — | — | — | — | — | |
| Booking Holdings Inc. | — | — | — | — | — | |
| Carnival Corp. & plc | — | — | — | — | — | |
| Chipotle Mexican Grill Inc. | — | — | — | — | — | |
| McDonald’s Corp. | — | — | — | — | — | |
| Starbucks Corp. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2015-12-26), 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29), 10-K (reporting date: 2011-12-31).
1 2015 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 29.56 = 12
2 Click competitor name to see calculations.
| 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. |
Operating Cycle
YUM! Brands Inc., operating cycle calculation, comparison to benchmarks
No. days
| Dec 26, 2015 | Dec 27, 2014 | Dec 28, 2013 | Dec 29, 2012 | Dec 31, 2011 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Average inventory processing period | 9 | 11 | 11 | 12 | 11 | |
| Average receivable collection period | 12 | 10 | 10 | 9 | 10 | |
| Short-term Activity Ratio | ||||||
| Operating cycle1 | 21 | 21 | 21 | 21 | 21 | |
| Benchmarks | ||||||
| Operating Cycle, Competitors2 | ||||||
| Carnival Corp. & plc | — | — | — | — | — | |
| Chipotle Mexican Grill Inc. | — | — | — | — | — | |
| McDonald’s Corp. | — | — | — | — | — | |
| Starbucks Corp. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2015-12-26), 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29), 10-K (reporting date: 2011-12-31).
1 2015 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= 9 + 12 = 21
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Operating cycle | Equal to average inventory processing period plus average receivables collection period. |
Average Payables Payment Period
YUM! Brands Inc., average payables payment period calculation, comparison to benchmarks
| Dec 26, 2015 | Dec 27, 2014 | Dec 28, 2013 | Dec 29, 2012 | Dec 31, 2011 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Payables turnover | 15.19 | 13.95 | 13.50 | 14.40 | 12.84 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average payables payment period1 | 24 | 26 | 27 | 25 | 28 | |
| Benchmarks (no. days) | ||||||
| Average Payables Payment Period, Competitors2 | ||||||
| Airbnb Inc. | — | — | — | — | — | |
| Booking Holdings Inc. | — | — | — | — | — | |
| Carnival Corp. & plc | — | — | — | — | — | |
| Chipotle Mexican Grill Inc. | — | — | — | — | — | |
| McDonald’s Corp. | — | — | — | — | — | |
| Starbucks Corp. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2015-12-26), 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29), 10-K (reporting date: 2011-12-31).
1 2015 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 15.19 = 24
2 Click competitor name to see calculations.
| 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. | YUM! Brands Inc. number of days of payables outstanding decreased from 2013 to 2014 and from 2014 to 2015. |
Cash Conversion Cycle
YUM! Brands Inc., cash conversion cycle calculation, comparison to benchmarks
No. days
| Dec 26, 2015 | Dec 27, 2014 | Dec 28, 2013 | Dec 29, 2012 | Dec 31, 2011 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Average inventory processing period | 9 | 11 | 11 | 12 | 11 | |
| Average receivable collection period | 12 | 10 | 10 | 9 | 10 | |
| Average payables payment period | 24 | 26 | 27 | 25 | 28 | |
| Short-term Activity Ratio | ||||||
| Cash conversion cycle1 | -3 | -5 | -6 | -4 | -7 | |
| Benchmarks | ||||||
| Cash Conversion Cycle, Competitors2 | ||||||
| Carnival Corp. & plc | — | — | — | — | — | |
| Chipotle Mexican Grill Inc. | — | — | — | — | — | |
| McDonald’s Corp. | — | — | — | — | — | |
| Starbucks Corp. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2015-12-26), 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29), 10-K (reporting date: 2011-12-31).
1 2015 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 9 + 12 – 24 = -3
2 Click competitor name to see calculations.
| 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. | YUM! Brands Inc. cash conversion cycle deteriorated from 2013 to 2014 and from 2014 to 2015. |