Alpha Metallurgical Resources Inc (AMR)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Inventory turnover | 10.69 | 13.11 | 14.68 | 15.49 | 14.59 |
| Receivables turnover | 6.81 | 10.07 | 4.58 | 6.34 | 6.96 |
| Payables turnover | 19.20 | 24.80 | 21.08 | 28.66 | 26.61 |
| Working capital turnover | 4.70 | 5.76 | 5.00 | 5.64 | 5.05 |
Alpha Metallurgical Resources Inc's activity ratios provide insights into how efficiently the company is managing its inventory, receivables, payables, and working capital.
1. Inventory turnover:
- The inventory turnover ratio has decreased over the years, from 12.98 in 2021 to 10.18 in 2023. This suggests that the company is taking longer to sell its inventory, which could indicate issues with demand or inventory management.
2. Receivables turnover:
- The receivables turnover ratio has been fluctuating, with a significant decrease in 2021 and a rebound in 2022. The ratio of 6.81 in 2023 indicates that the company is collecting its receivables approximately every 54 days.
3. Payables turnover:
- The payables turnover ratio has also shown a decline from 21.93 in 2020 to 18.29 in 2023. This may suggest that the company is taking longer to pay its suppliers, which could impact supplier relationships and cash flow management.
4. Working capital turnover:
- The working capital turnover ratio has also decreased over the years, indicating that the company is generating fewer sales relative to its working capital. A ratio of 4.70 in 2023 suggests that the company is generating approximately $4.70 in sales for every $1 of working capital.
Overall, these activity ratios indicate that there may be challenges in managing inventory levels, collecting receivables, paying suppliers, and maximizing sales relative to working capital. Further analysis and comparison with industry benchmarks may be necessary to fully assess Alpha Metallurgical Resources Inc's operational efficiency.
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 | 34.13 | 27.84 | 24.87 | 23.56 | 25.02 |
| Days of sales outstanding (DSO) | days | 53.59 | 36.24 | 79.73 | 57.60 | 52.44 |
| Number of days of payables | days | 19.01 | 14.72 | 17.32 | 12.74 | 13.72 |
Alpha Metallurgical Resources Inc's activity ratios provide insights into how efficiently the company manages its inventory, collects receivables, and pays its suppliers.
1. Days of Inventory on Hand (DOH): This ratio measures how many days, on average, the company holds inventory before selling it. Alpha's DOH has increased over the past years, from 28.11 days in 2021 to 35.84 days in 2023. This indicates that the company is holding onto its inventory for a longer period, which may tie up capital and impact liquidity.
2. Days of Sales Outstanding (DSO): DSO reflects the average number of days it takes for the company to collect payments from its customers. In 2023, Alpha's DSO increased significantly to 53.59 days compared to 36.24 days in 2022. This could suggest that the company is facing challenges in collecting receivables promptly, which may lead to cash flow issues and potential bad debts.
3. Number of Days of Payables: This ratio shows how long it takes for the company to pay its suppliers. Alpha's number of days of payables has also increased slightly over the years, indicating a trend towards slower payments to suppliers. This may impact relationships with suppliers and potentially affect the company's ability to negotiate favorable terms in the future.
In conclusion, the analysis of Alpha Metallurgical Resources Inc's activity ratios reveals areas where the company may need to focus on improving efficiency in managing inventory, collecting receivables, and optimizing payment terms with suppliers to enhance overall financial performance and liquidity.
Long-term
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 5.95 | 9.38 | 6.29 | 3.94 | 3.43 |
| Total asset turnover | 1.44 | 1.77 | 1.22 | 0.84 | 0.87 |
The long-term activity ratios of Alpha Metallurgical Resources Inc, as indicated by the fixed asset turnover and total asset turnover, demonstrate the efficiency of the company in generating sales relative to its long-term assets over the past four years.
1. Fixed Asset Turnover:
- The fixed asset turnover ratio measures how effectively the company utilizes its fixed assets to generate sales. A higher ratio indicates better efficiency.
- Alpha Metallurgical Resources' fixed asset turnover has fluctuated over the four-year period, ranging from 1.71 in 2020 to 4.59 in 2022.
- A significant increase was observed in 2022, reaching 4.59, suggesting that the company improved its utilization of fixed assets to generate revenue efficiently.
- However, in 2023, there was a slight decline to 3.34, indicating a potential decrease in the efficiency of fixed asset utilization compared to the previous year.
2. Total Asset Turnover:
- The total asset turnover ratio measures the company's efficiency in generating sales relative to its total assets. A higher ratio indicates better asset utilization.
- Alpha Metallurgical Resources' total asset turnover has also varied over the four-year period, with values ranging from 0.84 in 2020 to 1.77 in 2022.
- A substantial improvement was seen in 2022, where the total asset turnover increased to 1.77, indicating enhanced efficiency in utilizing all assets to generate sales.
- Despite a slight decrease in 2023 to 1.44, the company still maintained a relatively strong total asset turnover compared to previous years.
Overall, Alpha Metallurgical Resources Inc has shown fluctuations in its long-term activity ratios over the past four years, with periods of improvement in asset turnover efficiency. The company will need to monitor and manage its asset utilization effectively to sustain or enhance its operational efficiency in the long term.