American Airlines Group (AAL)

Activity ratios

Short-term

Turnover ratios

	Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020
Inventory turnover	13.59	13.93	14.01	14.17	14.57	14.17	15.33	15.52	15.32	15.16	13.69	14.03	14.43	12.37	11.86	11.41	12.77	9.95	11.14	12.14
Receivables turnover	26.75	28.74	24.96	24.53	24.85	25.10	24.48	25.23	21.97	21.75	21.17	21.39	18.66	17.38	14.00	12.22	12.28	20.94	37.05	42.04
Payables turnover	14.60	13.71	11.96	12.10	14.86	16.42	14.53	14.59	16.24	15.86	11.39	11.03	14.61	12.48	9.77	11.64	17.24	15.09	15.67	13.05
Working capital turnover	—	—	—	—	—	—	—	—	—	—	—	—	—	90.07	15.53	15.69	—	—	—	—

Inventory Turnover

The inventory turnover ratio for American Airlines Group has been fluctuating over the past few years, ranging from a low of 9.95 in September 2020 to a high of 15.52 in March 2023. Overall, the trend has been mostly increasing, indicating that the company is managing its inventory more efficiently and turning over its inventory at a faster rate.

Receivables Turnover

The receivables turnover ratio measures how quickly American Airlines Group collects outstanding receivables from its customers. The ratio has shown some variability, with a significant decrease from 42.04 in March 2020 to 12.28 in December 2020. However, there has been an increasing trend since then, reaching 26.75 in December 2024. This suggests that the company has been improving its efficiency in collecting payments from customers.

Payables Turnover

The payables turnover ratio of American Airlines Group reflects how quickly the company pays its suppliers and creditors. The ratio has shown some fluctuations over the years, ranging from a low of 9.77 in June 2021 to a high of 17.24 in December 2020. Overall, the trend seems to be relatively stable, indicating that the company is managing its payables effectively without significant volatility.

Working Capital Turnover

The working capital turnover ratio, which measures how efficiently a company is utilizing its working capital to generate sales, has been inconsistent for American Airlines Group. The ratio was not available for the earlier years, but it reached a high of 90.07 in September 2021 before becoming unavailable in subsequent periods. This lack of data may suggest changes in the company's operations or reporting practices that impact its working capital efficiency.

In conclusion, American Airlines Group has shown improvements in inventory turnover and receivables turnover ratios over the years, indicating better management of its assets and collections. The payables turnover ratio has been relatively stable, suggesting effective management of payables. However, the lack of data for working capital turnover makes it difficult to assess the company's efficiency in utilizing its working capital to generate sales in recent periods.

Average number of days

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020
Days of inventory on hand (DOH)	days	26.86	26.20	26.05	25.76	25.05	25.76	23.81	23.52	23.83	24.08	26.66	26.01	25.30	29.51	30.78	32.00	28.58	36.67	32.78	30.07
Days of sales outstanding (DSO)	days	13.65	12.70	14.62	14.88	14.69	14.54	14.91	14.47	16.61	16.78	17.25	17.06	19.56	21.00	26.07	29.87	29.71	17.43	9.85	8.68
Number of days of payables	days	24.99	26.62	30.52	30.16	24.56	22.22	25.12	25.01	22.47	23.01	32.05	33.08	24.98	29.26	37.37	31.34	21.18	24.19	23.30	27.97

American Airlines Group's activity ratios show the efficiency of its operations in managing inventory, collecting receivables, and paying its suppliers.

1. Days of Inventory on Hand (DOH): This ratio indicates how many days it takes for American Airlines Group to turn its inventory into sales. The trend shows a slight decrease in DOH from 2020 to 2024, from around 30 days to under 27 days. This suggests that the company has been managing its inventory more efficiently over time, perhaps by improving inventory management practices.

2. Days of Sales Outstanding (DSO): DSO measures how long it takes for American Airlines Group to collect payment from its customers. The data indicates a significant decrease in DSO, from around 30 days in 2020 to about 13 days in 2024. This improvement suggests that the company has been more effective in collecting receivables promptly, which can boost cash flow and liquidity.

3. Number of Days of Payables: This ratio reflects the number of days it takes for American Airlines Group to pay its suppliers. The trend shows some fluctuation but overall a decrease in payables days from 2020 to 2024, indicating that the company has been managing its payables more efficiently. This could result from renegotiating payment terms or streamlining the accounts payable process.

Overall, the improving trends in these activity ratios suggest that American Airlines Group has been enhancing its operational efficiency in managing inventory, collecting receivables, and paying its suppliers, which can lead to better cash flow management and overall financial health.

Long-term

	Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020
Fixed asset turnover	1.76	1.70	1.66	1.63	1.66	1.67	1.68	1.66	1.59	1.44	1.29	1.10	0.97	0.78	0.58	0.38	0.53	0.74	0.98	1.25
Total asset turnover	0.87	0.82	0.80	0.79	0.80	0.77	0.75	0.75	0.73	0.65	0.57	0.49	0.42	0.34	0.24	0.17	0.27	0.38	0.50	0.73

The Fixed Asset Turnover ratio for American Airlines Group has shown a fluctuating trend over the years, starting at 1.25 in March 2020 and gradually declining to 0.38 by March 2021. However, the ratio then started to improve, reaching its peak of 1.76 by December 2024. This indicates that the company was able to generate more revenue relative to its fixed assets in recent years.

In contrast, the Total Asset Turnover ratio reflects a declining trend overall, starting at 0.73 in March 2020 and steadily decreasing to 0.27 by December 2020. From there, the ratio gradually improved, reaching 0.87 by December 2024. This suggests that American Airlines Group may have become more efficient in utilizing its total assets to generate sales in the latter part of the period under consideration.

Overall, these long-term activity ratios suggest that American Airlines Group has made strides in improving the efficiency of its asset utilization and revenue generation over the years, especially evident in the improving Fixed Asset Turnover ratio and the overall upward trend in the Total Asset Turnover ratio.