Amcor PLC (AMCR)

Short-term

Turnover ratios

The activity ratios of Amcor PLC provide insights into the company's operational efficiency over the analyzed period. An assessment of inventory turnover indicates a relatively stable trend, with values oscillating between approximately 4.95 and 5.49 during most of 2021 and 2022, reflecting consistent inventory management and sales cycles. A noticeable increase is observed in late 2023 and mid-2024, with ratios reaching over 5.4, implying improved inventory utilization and faster stock turnover. However, towards the end of the period, the ratio declines to around 3.51 in June 2025, which may point to slower inventory movement or increased stock holdings.

Receivables turnover ratios suggest a generally stable collection efficiency, averaging around 7.0 to 7.8 times during the period, indicating that accounts receivable are collected roughly every 46 to 52 days. Periods of slight fluctuation reflect minor variances in credit recovery times, with notable dips observed in mid-2025 where the ratio falls to 4.38, corresponding to extended collection periods. This decline could signal emerging collection challenges or changes in credit policies.

Payables turnover ratios demonstrate variation consistent with supplier payment practices, fluctuating from approximately 3.82 to 5.29 times throughout the period. The increases in late 2023 and 2024 suggest efforts to accelerate payments or shifts in payment terms, whereas dips in 2021 and mid-2025 indicate extended credit periods granted to suppliers, possibly to conserve cash.

The working capital turnover ratio exhibits significant variability, reflecting the influence of operational changes on working capital efficiency. High ratios of over 19 times in mid-2022 coincide with periods of efficient working capital utilization, while sharp declines to below 5 in March 2025 point to potential challenges in managing working capital or shifts in operational scale.

Overall, the activity ratios depict a company with generally stable inventory and receivables management, occasional fluctuations in supplier payables, and episodes of varying working capital efficiency. Recent declines in inventory and receivables turnover ratios in mid-2025 may warrant closer scrutiny to assess underlying operational or strategic shifts impacting efficiency.

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Average number of days

The activity ratios for Amcor PLC, specifically Days of Inventory on Hand (DOH), Days of Sales Outstanding (DSO), and Days of Payables, demonstrate several notable trends over the period from September 2020 through June 2025.

Days of Inventory on Hand (DOH): The data indicates a gradual increase in inventory holding periods, rising from approximately 66.57 days in September 2020 to a peak of 78.79 days in September 2022. Subsequently, a slight decline is observed, with the figure decreasing to around 66.44 days by September 2023 before rising again in 2024 and 2025, reaching approximately 104.06 days in June 2025. Overall, the pattern suggests periods of inventory accumulation followed by adjustments, reflecting either strategic inventory buildup, supply chain dynamics, or shifts in production or demand cycles.

Days of Sales Outstanding (DSO): This ratio reveals a relatively stable receivables collection period, fluctuating around the mid-40s to low 50s days. A notable increase appears in the latest quarter (June 2025), where DSO climbs sharply to 83.32 days from approximately 47–53 days in earlier periods. This sudden rise could indicate deteriorating receivables collection efficiency or changes in credit policy, possibly impacting cash flow management.

Number of Days of Payables: The payables period exhibits significant fluctuations throughout the period. Early on, the payables duration tends to be in the range of 67 to 92 days, with a notable peak of 95.67 days in June 2022. Recent data shows a general decreasing trend, reaching approximately 69.06 days in September 2023, before increasing again to over 104 days in June 2025. Extended payment periods can indicate strategic delaying of payables to optimize liquidity, whereas reductions suggest more prompt payment practices.

Overall Observations: The trends suggest that Amcor PLC has experienced fluctuations in inventory management, receivables, and payables over the analyzed period. The recent significant increase in both inventory days and payables in mid-2025 could reflect changes in operational strategies, supply chain disruptions, or shifts in customer and supplier credit terms. The notable rise in DSO in June 2025 warrants scrutiny, as it may have implications for liquidity and working capital management. Overall, these ratios highlight the dynamic nature of Amcor’s activity management, underscoring periods of operational agility as well as potential liquidity or efficiency risks.

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Long-term

The analysis of Amcor PLC's long-term activity ratios, based on the provided data, reveals several noteworthy trends and patterns over the periods in question.

Fixed Asset Turnover:
- The ratio demonstrates a general upward trend from September 30, 2020, reaching a peak of 4.13 on September 30, 2022.
- Following this peak, a gradual decline is observable, with the ratio decreasing to 3.40 by September 30, 2023.
- The data for subsequent periods up to March 2025 are not available, preventing further assessment beyond September 2023.
- The initial increase from 2.99 in September 2020 to above 4.00 in 2022 indicates improved efficiency in utilizing fixed assets to generate revenue.
- The subsequent decline suggests a potential decrease in asset utilization efficiency or a strategic shift in fixed asset deployment during 2023.

Total Asset Turnover:
- The ratio remains relatively stable from September 2020 through September 2023, fluctuating narrowly between 0.75 and 0.86.
- A consistent upward trend is evident until September 2022, where the ratio peaks at 0.86.
- After September 2022, a downward movement occurs, with the ratio decreasing slightly to 0.80 by September 2024.
- The data points for 2024 and early 2025 show a decline to 0.75 in June 2025, signaling a significant reduction in total asset utilization efficiency.
- The stability in the earlier periods suggests consistent management of asset base, while the declining ratio from late 2022 indicates potential challenges in asset productivity or changes in revenue generation mechanisms.

Overall, the data reflect a period of efficiency gains in fixed asset utilization up to late 2022, followed by a decline that may warrant further investigation into asset management practices and revenue generation strategies. The trends highlight the importance of monitoring asset efficiency ratios over time to assess operational performance and strategic shifts.