Acuity Brands Inc (AYI)

Short-term

Turnover ratios

Acuity Brands Inc's activity ratios provide insight into the efficiency of the company's operational processes.

1. Inventory turnover:
The inventory turnover ratio has been consistent over the periods, ranging from 4.42 to 9.61. A higher turnover ratio indicates that Acuity Brands is effectively managing its inventory levels and converting inventory into sales at a faster rate.

2. Receivables turnover:
Acuity Brands has maintained a relatively stable receivables turnover ratio, fluctuating between 5.98 and 7.80. This suggests that the company is efficient in collecting its accounts receivables from customers, with the ability to convert these receivables into cash multiple times during the period.

3. Payables turnover:
The payables turnover ratio has also remained fairly consistent, varying from 5.35 to 12.40. A higher turnover ratio indicates that the company is efficiently managing its trade payables by paying suppliers promptly.

4. Working capital turnover:
Acuity Brands demonstrates a consistent performance in terms of working capital turnover, with values ranging from 3.23 to 5.64. This ratio reflects the company's ability to generate sales revenue relative to the level of working capital invested in the business. A higher turnover ratio signifies more efficient utilization of working capital.

Overall, Acuity Brands Inc's activity ratios suggest that the company is effectively managing its inventory, receivables, payables, and working capital, indicating operational efficiency and effective utilization of resources.

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Average number of days

The analysis of Acuity Brands Inc's activity ratios over the past few quarters indicates the following trends:

1. Days of Inventory on Hand (DOH): Acuity Brands has shown a generally stable trend in managing its inventory efficiently. The number of days of inventory on hand has ranged from 37.98 days to 50.12 days over the period analyzed, with a slight increase in recent quarters. This suggests that the company is effectively managing its inventory levels and turning over its inventory in a reasonable timeframe.

2. Days of Sales Outstanding (DSO): The days of sales outstanding have fluctuated between 46.77 days and 61.08 days, indicating some variability in the collection of receivables. The lower DSO values suggest that the company is efficiently collecting payments from customers, while higher values may indicate delays or challenges in collecting receivables. Overall, it is important for Acuity Brands to continue monitoring and improving its accounts receivable management to ensure timely collection.

3. Number of Days of Payables: Acuity Brands’ number of days of payables have shown a relatively stable trend, ranging from 29.44 days to 68.24 days. A higher number of days of payables may indicate that the company is taking longer to pay its suppliers, potentially improving its working capital position, but it could also strain relationships with suppliers if payment delays become excessive.

In conclusion, Acuity Brands Inc has exhibited reasonably efficient management of its inventory, receivables, and payables, with some fluctuations observed in the collection of receivables. Continued monitoring and optimization of these activity ratios will be essential for maintaining a healthy working capital cycle and overall financial stability.

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Long-term

The fixed asset turnover ratio for Acuity Brands Inc has been relatively stable over the past few years, ranging between 12.28 and 14.48. This ratio measures the efficiency of the company in generating sales revenue from its investment in fixed assets. A higher fixed asset turnover ratio indicates better utilization of fixed assets to generate sales.

On the other hand, the total asset turnover ratio has shown a slightly fluctuating trend, ranging between 0.94 and 1.21. This ratio reflects how efficiently the company is using all its assets to generate sales. A higher total asset turnover ratio implies effective asset management and a more efficient use of resources to generate revenue.

Overall, Acuity Brands Inc has been maintaining a strong fixed asset turnover ratio consistently over time, indicating efficient utilization of fixed assets in generating revenue. The total asset turnover ratio has shown some variability but generally reflects the company's ability to generate sales from its total asset base.