Autoliv Inc (ALV)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Inventory turnover | 9.05 | 8.14 | 9.22 | 8.41 | 10.03 |
| Receivables turnover | 4.59 | 4.50 | 4.70 | 4.04 | 5.21 |
| Payables turnover | 4.63 | 4.66 | 6.34 | 5.47 | 7.90 |
| Working capital turnover | — | 122.75 | 9.60 | 6.55 | 14.30 |
Autoliv Inc.'s inventory turnover has shown a somewhat fluctuating trend over the past five years, ranging from a low of 7.68 in 2022 to a high of 9.40 in 2019. The ratio indicates that in 2023, the company's inventory turnover improved to 8.55, reflecting that Autoliv Inc. converted its inventory into sales more efficiently compared to the previous year.
The receivables turnover ratio has also shown some variability, with a slight increase in 2023 compared to 2022. Autoliv Inc. collected its receivables approximately 4.64 times in 2023, up from 4.51 times in 2022, suggesting an improvement in the company's ability to collect outstanding receivables promptly.
Regarding payables turnover, Autoliv Inc.'s performance has been relatively stable over the years, with the ratio ranging between 4.38 and 7.40. In 2023, the payables turnover decreased slightly to 4.38, indicating that the company took longer to pay its suppliers compared to the previous year.
The working capital turnover ratio provides insight into how effectively Autoliv Inc. utilized its working capital to generate sales revenue. The ratio was not available for 2021, but in 2023, it significantly increased to 119.49 from 9.64 in 2022. This substantial rise suggests that Autoliv Inc. generated a much higher level of sales revenue relative to its working capital investment in 2023.
Overall, Autoliv Inc.'s activity ratios reflect varying degrees of efficiency in managing inventory, collecting receivables, paying suppliers, and utilizing working capital to drive sales growth over the years.
Average number of days
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 40.35 | 44.85 | 39.60 | 43.42 | 36.40 |
| Days of sales outstanding (DSO) | days | 79.61 | 81.03 | 77.66 | 90.34 | 70.02 |
| Number of days of payables | days | 78.87 | 78.36 | 57.55 | 66.76 | 46.22 |
In analyzing Autoliv Inc.'s activity ratios, we can observe the following trends over the past five years:
1. Days of Inventory on Hand (DOH):
- Autoliv Inc. has generally maintained a stable level of inventory turnover over the past five years, with fluctuations between 42.21 and 47.50 days.
- The company has been able to effectively manage its inventory levels, resulting in a moderate average DOH ratio. A decreasing trend from 2019 to 2020 was followed by a slight increase in 2022.
- The latest DOH figure of 42.68 days indicates that Autoliv Inc. holds, on average, approximately 42.68 days of inventory on hand, which is relatively consistent with previous years.
2. Days of Sales Outstanding (DSO):
- Autoliv Inc.'s DSO ratio has shown some variability over the past five years, ranging from 70.61 to 91.44 days.
- The DSO ratio provides insight into the company's ability to collect accounts receivable efficiently. A lower DSO indicates that Autoliv Inc. is collecting payments more quickly from customers.
- In 2023, the DSO ratio decreased to 78.68 days compared to the previous year, suggesting an improvement in the company's collection efficiency.
3. Number of Days of Payables:
- Autoliv Inc.'s days of payables have demonstrated fluctuations over the past five years, fluctuating between 49.33 and 83.43 days.
- A higher number of days of payables means that the company takes longer to pay its suppliers, potentially indicating a more favorable position in terms of cash flow management.
- The increase in days of payables from 2022 to 2023 to 83.43 days may imply that Autoliv Inc. is taking longer to settle its payables, possibly due to strategic reasons or changes in supplier relationships.
Overall, Autoliv Inc.'s activity ratios reflect a mixed performance in managing its working capital components, with some improvements in collection efficiency but some volatility in inventory management and payables settlement. Monitoring these ratios can provide valuable insights into the company's operational efficiency and financial health.
Long-term
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 4.72 | 4.51 | 4.42 | 3.93 | 4.66 |
| Total asset turnover | 1.24 | 1.15 | 1.09 | 0.90 | 1.25 |
Autoliv Inc.'s long-term activity ratios provide insights into how efficiently the company is utilizing its assets over the years. The fixed asset turnover ratio has shown a fluctuating trend, peaking at 4.78 in 2023 and hitting a low of 3.98 in 2020. This ratio indicates that, on average, Autoliv generates approximately $4.78 in sales for every $1 invested in fixed assets.
The total asset turnover ratio also displays fluctuations, with a general increasing trend from 0.91 in 2020 to 1.26 in 2023. This ratio signifies that Autoliv generates $1.26 in sales for every $1 of total assets it holds, showing an upward trend in asset utilization efficiency over the years.
The fixed asset turnover ratio highlights the efficiency of Autoliv in generating sales from its fixed assets, while the total asset turnover ratio showcases the overall efficiency in utilizing all assets to generate revenue. The increasing total asset turnover ratio suggests that Autoliv has been more efficient in utilizing all its assets collectively to generate sales in recent years.