Agilysys Inc (AGYS)

Short-term

Turnover ratios

Agilysys Inc's inventory turnover has shown a decreasing trend over the years, dropping from 40.61 in March 31, 2021, to 7.90 in March 31, 2023, before experiencing a slight increase to 20.32 in March 31, 2024. This suggests that the company is taking longer to sell its inventory or managing its inventory less efficiently.

On the other hand, the receivables turnover ratio has been relatively stable, indicating the company's ability to collect its receivables efficiently. The ratio increased from 4.88 in March 31, 2021, to 8.04 in March 31, 2023, before decreasing slightly to 7.48 in March 31, 2024.

In terms of payables turnover, Agilysys Inc has shown a mixed performance, with the ratio declining from 7.53 in March 31, 2021, to 6.26 in March 31, 2022, before rising to 9.89 in March 31, 2024. A higher payables turnover ratio indicates that the company is taking longer to pay its suppliers, which could potentially strain its relationships with suppliers.

Lastly, the working capital turnover has fluctuated but remained relatively stable, with slight variations from 1.90 in March 31, 2021, to 2.60 in March 31, 2023, and then declining to 2.38 in March 31, 2024. This ratio indicates how effectively the company is utilizing its working capital to generate revenue.

Overall, Agilysys Inc's activity ratios reflect certain areas of strengths and weaknesses in its operations and efficiency in managing inventory, receivables, payables, and working capital turnover.

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Average number of days

Agilysys Inc's activity ratios provide insights into how efficiently the company manages its inventory, collects receivables, and pays its payables.

1. Days of Inventory on Hand (DOH):
- Agilysys Inc's DOH has fluctuated over the years, ranging from 8.99 days in 2021 to 46.18 days in 2023.
- A lower DOH indicates that the company is selling inventory quickly, which is positive for cash flow and profitability.
- However, the significant increase in DOH from 2021 to 2023 suggests potential issues with managing inventory levels efficiently.

2. Days of Sales Outstanding (DSO):
- Agilysys Inc's DSO has shown a decreasing trend from 74.76 days in 2021 to 45.37 days in 2023.
- A lower DSO reflects that the company is collecting receivables faster, which improves liquidity and reduces the risk of bad debts.
- The decreasing trend indicates that the company has been more successful in converting credit sales into cash.

3. Number of Days of Payables:
- Agilysys Inc's number of days of payables has fluctuated, with a decrease from 48.46 days in 2021 to 36.90 days in 2024.
- A lower number of days of payables might indicate tighter payment terms with suppliers, but it can also suggest efficient cash management.
- The decreasing trend in the number of days of payables can indicate an improvement in managing supplier payments effectively.

Overall, Agilysys Inc's activity ratios reflect changes in its inventory management, accounts receivable collection, and accounts payable practices over the years. It is essential for the company to continue monitoring and optimizing these activity ratios to ensure operational efficiency and financial stability.

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Long-term

Agilysys Inc's fixed asset turnover ratio has shown a positive trend over the years, increasing from 6.53 in 2021 to 13.59 in 2023. This indicates that the company has been able to generate more revenue from its fixed assets over time, which is a positive signal of efficiency in utilizing its long-term assets.

On the other hand, the total asset turnover ratio has been somewhat fluctuating, with a slight increase from 0.72 in 2021 to 0.81 in 2023, but then a decline to 0.63 in 2025. This ratio measures how efficiently the company is generating revenue from all its assets. The fluctuation in this ratio may imply changes in the company's asset management efficiency and revenue generation capability.

Overall, while the fixed asset turnover ratio of Agilysys Inc has seen a significant improvement, the total asset turnover ratio shows some inconsistency in performance. It is important for the company to closely monitor these ratios to ensure optimal utilization of assets and sustainable revenue generation in the long term.