AdvanSix Inc (ASIX)

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	6.93	6.27	6.94	7.48	7.99	11.07	10.77	9.51	9.99	9.88	9.32	8.07	6.08	4.59	4.44	5.84	5.36	7.80	9.62	9.73
Receivables turnover	9.14	10.61	11.05	11.48	10.50	9.78	7.84	7.98	9.38	9.32	8.64	8.18	8.50	10.28	13.79	10.45	12.16	12.42	11.10	12.54
Payables turnover	5.67	6.23	7.12	7.91	6.32	6.62	6.15	7.75	6.75	6.47	6.70	6.59	5.76	4.45	5.38	4.96	4.47	5.78	6.90	7.27
Working capital turnover	25.06	14.66	15.38	23.25	40.98	41.16	24.26	16.95	41.98	59.26	25.72	24.23	24.84	20.58	9.48	26.89	—	378.61	35.74	120.68

AdvanSix Inc's activity ratios provide insight into how efficiently the company is managing its assets and liabilities through the following key ratios:

1. Inventory turnover: AdvanSix's inventory turnover has shown a decreasing trend over the last few quarters, indicating that the company is selling its inventory at a slower rate. This could potentially signal overstocking or weakening demand for its products.

2. Receivables turnover: The receivables turnover has been relatively stable, suggesting that AdvanSix has been efficient in collecting payments from its customers. A higher turnover ratio indicates that the company is collecting its accounts receivables more quickly.

3. Payables turnover: AdvanSix's payables turnover has fluctuated but generally remained at a moderate level. A higher payables turnover ratio implies that the company is paying its suppliers more quickly, which could help improve its cash flow position.

4. Working capital turnover: The working capital turnover ratio measures how efficiently a company is using its working capital to generate sales. AdvanSix's working capital turnover has shown a fluctuating pattern but generally remained at a high level. A high working capital turnover ratio indicates that the company is effectively utilizing its working capital to support its operations and generate revenue.

Overall, the analysis of AdvanSix Inc's activity ratios suggests that the company is managing its assets and liabilities efficiently, particularly in terms of accounts receivables and working capital utilization. However, there may be potential concerns related to inventory management based on the decreasing trend in inventory turnover.

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	52.67	58.21	52.62	48.77	45.66	32.96	33.89	38.37	36.54	36.96	39.15	45.24	59.99	79.44	82.15	62.52	68.11	46.77	37.94	37.53
Days of sales outstanding (DSO)	days	39.91	34.41	33.04	31.79	34.78	37.34	46.58	45.74	38.90	39.15	42.27	44.59	42.97	35.50	26.46	34.94	30.02	29.40	32.90	29.11
Number of days of payables	days	64.41	58.55	51.26	46.14	57.79	55.15	59.35	47.09	54.04	56.37	54.44	55.38	63.37	82.08	67.87	73.55	81.68	63.11	52.86	50.22

AdvanSix Inc's activity ratios provide insights into the efficiency of its operations and management of working capital.

1. Days of Inventory on Hand (DOH):
- The trend in DOH shows fluctuation, but on average, the company has been holding inventory for around 50-60 days.
- A lower number of days indicates faster inventory turnover, potentially leading to lower carrying costs and a more efficient use of resources.
- The increase in DOH from Q3 2022 to Q4 2023 may suggest a buildup in inventory levels that could tie up cash flow.

2. Days of Sales Outstanding (DSO):
- AdvanSix Inc's DSO has varied between 31 to 47 days over the past eight quarters.
- Lower DSO values indicate faster collection of receivables, which can improve cash flow and working capital management.
- The decreasing trend from Q2 2022 to Q1 2023 could suggest more efficient credit and collection policies by the company.

3. Number of Days of Payables:
- The company's days of payables have been between 48 to 69 days over the observed period.
- A higher number of days of payables may indicate that the company is taking longer to pay its suppliers, potentially benefiting from improved cash flow management.
- The increase in Q4 2023 compared to Q3 2023 suggests the company is taking longer to pay its bills, potentially impacting relationships with suppliers.

In conclusion, AdvanSix Inc's activity ratios indicate varying levels of efficiency in managing inventory, receivables, and payables. The company may need to focus on optimizing inventory levels, improving receivables collection, and maintaining healthy supplier relationships to enhance working capital management and overall operational efficiency.

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	1.79	1.87	2.09	2.30	2.40	2.44	2.46	2.28	2.19	2.10	1.89	1.61	1.51	1.49	1.53	1.68	1.72	1.85	2.02	2.15
Total asset turnover	1.02	1.05	1.16	1.29	1.30	1.35	1.30	1.22	1.28	1.24	1.15	0.99	0.91	0.92	0.91	1.02	1.05	1.12	1.22	1.31

The fixed asset turnover ratio measures how efficiently a company generates revenue from its fixed assets. AdvanSix Inc's fixed asset turnover ratio has been fluctuating over the past eight quarters, ranging from 2.46 to 1.80. The trend shows a general decrease in efficiency in utilizing fixed assets, with a peak in Q2 2022 and a decline thereafter. This may indicate underutilization or aging of fixed assets, which could impact the company's profitability and operational efficiency.

On the other hand, the total asset turnover ratio measures how efficiently a company generates sales from all its assets. AdvanSix Inc's total asset turnover ratio also exhibits some fluctuation, ranging from 1.30 to 1.03 over the same period. The trend in total asset turnover shows a decline in efficiency in generating sales from assets, indicating a decrease in overall asset utilization efficiency.

Overall, the declining trend in both the fixed asset turnover and total asset turnover ratios for AdvanSix Inc suggests potential inefficiencies in asset utilization and revenue generation. Management may need to assess and address these issues to improve operational performance and profitability in the long term.