Albemarle Corp (ALB)

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	3.54	4.39	4.49	4.44	3.90	2.05	1.58	1.53	2.05	2.03	2.32	2.41	2.92	3.07	3.00	3.21	2.84	2.63	2.64	2.67
Receivables turnover	4.21	5.33	6.23	6.40	4.16	5.79	5.46	5.27	4.60	4.78	3.99	4.97	4.52	5.74	6.29	5.42	4.58	5.61	5.68	5.90
Payables turnover	—	—	—	—	—	—	—	2.77	2.77	1.99	2.58	2.89	3.88	4.19	4.11	4.47	4.42	4.67	4.30	3.98
Working capital turnover	2.87	2.36	2.28	2.23	5.81	3.10	3.05	2.78	2.99	3.09	2.76	15.55	27.89	6.80	2.77	3.05	7.74	5.28	3.87	3.63

Albemarle Corp's activity ratios provide insight into how efficiently the company manages its assets and operations.

1. Inventory Turnover:
Albemarle's inventory turnover ratio has shown fluctuations over the years, ranging from 1.53 to 4.49. A higher inventory turnover ratio indicates that the company is selling its inventory quickly and efficiently. The increase in the inventory turnover ratio from 2022 to 2024 suggests that Albemarle has improved its inventory management and sales effectiveness during this period.

2. Receivables Turnover:
The receivables turnover ratio for Albemarle fluctuated between 3.99 and 6.40 over the years. A higher receivables turnover ratio indicates that the company is collecting its receivables more quickly. The fluctuation in the ratio implies changes in the company's credit policies, customer payment behavior, and efficiency in managing accounts receivable.

3. Payables Turnover:
Albemarle's payables turnover ratio decreased from 4.67 in September 2020 to 2.77 in March 2023 and became undefined from June 2023 onwards. A lower payables turnover ratio may suggest the company is taking longer to pay its suppliers. The undefined values from June 2023 onwards could indicate changes in the company's payment terms or data availability.

4. Working Capital Turnover:
The working capital turnover ratio demonstrates how effectively Albemarle utilizes its working capital to generate revenue. The ratio varied significantly over the years, indicating fluctuations in the company's working capital management efficiency. A higher ratio signifies that Albemarle is generating more revenue per unit of working capital employed.

Overall, analyzing these activity ratios provides valuable insights into Albemarle Corp's operational efficiency, inventory management, accounts receivable collection, payment practices, and working capital utilization. It is essential for investors and stakeholders to monitor these ratios to assess the company's operational performance and financial health.

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	103.18	83.09	81.33	82.29	93.56	177.74	230.92	238.37	178.48	179.45	157.60	151.46	125.11	119.04	121.67	113.63	128.32	139.00	138.00	136.64
Days of sales outstanding (DSO)	days	86.79	68.43	58.62	57.05	87.65	63.08	66.90	69.25	79.30	76.40	91.55	73.47	80.70	63.58	58.04	67.29	79.69	65.03	64.30	61.85
Number of days of payables	days	—	—	—	—	—	—	—	131.76	131.85	183.63	141.45	126.35	94.07	87.16	88.88	81.61	82.65	78.16	84.81	91.75

Albemarle Corp's activity ratios, specifically Days of Inventory on Hand (DOH), Days of Sales Outstanding (DSO), and Number of Days of Payables, provide insights into the efficiency of the company's operations and management of working capital.

1. Days of Inventory on Hand (DOH): The trend of Albemarle Corp's DOH indicates the number of days it takes for the company to sell its inventory. The DOH increased steadily from March 31, 2020, to September 30, 2022, suggesting a longer holding period for inventory. However, there was a significant spike in DOH in March 31, 2023, which may signal potential issues in inventory management. Subsequently, a sharp decrease was observed by December 31, 2024, indicating improvements in inventory turnover.

2. Days of Sales Outstanding (DSO): The DSO ratio tracks how long it takes for the company to collect cash from its credit sales. Albemarle Corp's DSO fluctuated throughout the period, with some volatility evident. A peak in DSO was observed on December 31, 2021, which could indicate delays in receivables collection. However, the trend improved, with a decreasing DSO observed from March 31, 2023, to December 31, 2024, reflecting a more efficient collection of accounts receivable.

3. Number of Days of Payables: This ratio showcases the number of days the company takes to pay its suppliers. Albemarle Corp's payables days trend indicates changes in its payment terms and relationships with suppliers. A notable increase in payables days was observed from March 31, 2022, to September 30, 2022, signaling a potential extension in payment terms. It is important to note the missing data for the payables days from June 30, 2023, onwards, which limits a comprehensive analysis of the company's payment practices.

In conclusion, analyzing activity ratios such as DOH, DSO, and payables days provides valuable insights into Albemarle Corp's operational efficiency, inventory management, accounts receivable collection, and vendor payment practices. Monitoring these ratios over time can help in assessing the company's working capital management and overall operational performance.

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	0.58	0.70	0.76	0.86	1.01	1.19	1.23	1.19	1.05	0.87	0.70	0.60	0.56	0.59	0.59	0.60	0.58	0.62	0.66	0.70
Total asset turnover	0.32	0.37	0.41	0.44	0.53	0.52	0.51	0.50	0.47	0.40	0.35	0.32	0.30	0.31	0.30	0.31	0.30	0.32	0.33	0.36

Albemarle Corp's Fixed Asset Turnover ratio has shown a fluctuating trend over the years, ranging from 0.56 to 1.23. The ratio has generally been improving since March 2022, peaking at 1.23 in June 2023, suggesting that the company is generating more revenue from its fixed assets.

On the other hand, Albemarle Corp's Total Asset Turnover ratio has also been variable, with values between 0.30 and 0.53. There is a slight upward trend in the ratio from March 2022 to December 2023, indicating the company is becoming more efficient at generating sales from its total assets.

Overall, the Fixed Asset Turnover and Total Asset Turnover ratios suggest that Albemarle Corp has been effectively utilizing its assets to generate revenue, with improvements in asset efficiency over the years.