Allegion PLC (ALLE)

Activity ratios

Short-term

Turnover ratios

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 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Inventory turnover 6.77 6.27 6.13 6.04 5.63 5.41 5.63 5.92 6.17 5.17 5.73 5.76 6.20 7.96 7.90 8.76 8.57 7.77 7.48 7.60
Receivables turnover 8.43 8.03 8.33 7.61 8.05 7.27 8.63 8.79 9.96 9.22 8.98 8.60 8.29 7.47 8.02 8.11 8.38 7.57 7.23 7.56
Payables turnover 11.46 11.96 11.17 10.28 9.61 9.70 8.66 9.24 9.06 8.41 7.63 7.96 7.96 12.06 11.86 12.14 10.46 10.94 11.03 11.37
Working capital turnover 12.64 5.26 5.74 5.79 6.23 5.62 2.52 5.75 5.46 6.94 4.90 4.96 4.28 4.15 5.14 5.98 5.58 6.30 7.50 7.46

Allegion plc's activity ratios indicate the efficiency of its operations relating to inventory, accounts receivable, accounts payable, and working capital turnover.

1. Inventory turnover has been consistently improving over the quarters, indicating that Allegion is efficiently managing its inventory levels and turning over its inventory at a faster rate. This could result in reduced holding costs and better liquidity.

2. Receivables turnover has fluctuated but generally remained at healthy levels, suggesting that Allegion is collecting its accounts receivable efficiently. A higher turnover ratio indicates that the company is collecting its receivables faster.

3. Payables turnover has shown some variability but has generally been stable over the quarters. This ratio reflects how quickly Allegion pays its suppliers. A higher payables turnover ratio may indicate that the company is taking longer to pay its bills, potentially improving cash flow.

4. Working capital turnover has shown significant fluctuations, with a notable increase in Q4 2023 compared to previous quarters. This ratio measures how efficiently Allegion is utilizing its working capital to generate sales. A higher turnover ratio suggests that the company is effectively using its resources to generate revenue.

Overall, Allegion's activity ratios demonstrate efficient management of inventory, receivables, payables, and working capital, which is crucial for maintaining liquidity, optimizing cash flow, and sustaining operational efficiency.

Average number of days

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 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Days of inventory on hand (DOH) days 53.88 58.24 59.55 60.40 64.80 67.53 64.86 61.61 59.17 70.66 63.66 63.34 58.89 45.86 46.23 41.69 42.60 46.95 48.83 48.03
Days of sales outstanding (DSO) days 43.31 45.48 43.82 47.98 45.32 50.19 42.30 41.54 36.66 39.60 40.66 42.45 44.02 48.86 45.49 45.00 43.56 48.19 50.50 48.25
Number of days of payables days 31.85 30.53 32.69 35.50 37.97 37.64 42.15 39.51 40.30 43.41 47.85 45.84 45.84 30.26 30.78 30.07 34.89 33.35 33.09 32.09

Allegion plc's activity ratios reflect the efficiency with which the company manages its inventory, receivables, and payables.

Days of Inventory on Hand (DOH): The trend in Allegion's DOH shows a decrease from Q4 2022 to Q4 2023, implying that the company has been able to reduce the number of days it holds inventory on hand. This indicates an improvement in inventory management efficiency over the past year.

Days of Sales Outstanding (DSO): The DSO for Allegion has fluctuated over the quarters, but generally shows a decreasing trend from Q4 2022 to Q4 2023. This could suggest that Allegion has been able to collect receivables more quickly, leading to improved cash flows and working capital management.

Number of Days of Payables: Allegion's number of days of payables fluctuates throughout the quarters, but there is a general trend of an increase from Q4 2022 to Q4 2023. This may indicate that the company is taking longer to pay its suppliers, which could have implications for supplier relationships and liquidity management.

In summary, Allegion plc has shown improvements in managing its inventory and receivables efficiently over the past year. However, the trend in payables management indicates a potential area for further evaluation to maintain supplier relationships and overall liquidity position.

Long-term

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 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Fixed asset turnover 9.92 10.54 10.71 10.59 10.32 10.57 10.34 10.15 9.94 10.17 9.92 9.41 9.05 8.93 9.03 9.62 9.48 9.87 9.75 9.89
Total asset turnover 0.82 0.84 0.85 0.82 0.80 0.78 0.79 0.95 0.92 0.91 0.93 0.91 0.87 0.87 0.93 1.01 0.93 0.97 0.96 0.97

Allegion plc's long-term activity ratios show a consistent and strong performance over the past eight quarters. The fixed asset turnover ratio has remained relatively stable around 10.50, indicating that the company efficiently utilizes its fixed assets to generate sales. This suggests that Allegion is effectively managing its long-term investments in property, plant, and equipment.

In terms of total asset turnover, the company has shown an improving trend, with the ratio increasing from 0.79 in Q3 2022 to 0.87 in Q2 2023. This indicates that Allegion is becoming more efficient in generating sales relative to its total assets. The increasing total asset turnover ratio suggests that Allegion is effectively managing its overall asset base to drive higher revenue.

Overall, both the fixed asset turnover and total asset turnover ratios indicate that Allegion plc has a strong operational efficiency in utilizing its assets to generate sales. This efficiency can enhance the company's profitability and overall financial performance in the long term.