Cleveland-Cliffs Inc (CLF)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Inventory turnover | 3.90 | 4.81 | 4.97 | 4.79 | 4.81 | 4.67 | 4.57 | 4.38 | 4.11 | 3.62 | 3.28 | 3.14 | 3.17 | 3.16 | 2.69 | 2.26 | 1.44 | 2.07 | 1.31 | 0.80 |
| Receivables turnover | 12.17 | 12.62 | 11.85 | 11.72 | 11.95 | 10.33 | 9.60 | 10.08 | 11.73 | 10.12 | 9.20 | 8.38 | 9.48 | 7.39 | 6.30 | 5.45 | 4.49 | 5.48 | 4.67 | 3.52 |
| Payables turnover | 9.89 | 10.28 | 10.04 | 10.39 | 10.21 | 10.32 | 10.20 | 9.92 | 9.65 | 8.49 | 7.31 | 7.69 | 7.94 | 7.78 | 6.92 | 5.11 | 3.50 | 5.24 | 5.01 | 2.08 |
| Working capital turnover | 5.35 | 7.20 | 7.31 | 7.13 | 7.03 | 6.01 | 5.85 | 5.60 | 5.94 | 4.91 | 4.94 | 4.65 | 5.00 | 4.49 | 3.62 | 3.09 | 2.26 | 2.57 | 1.58 | 1.29 |
Cleveland-Cliffs Inc's activity ratios show the company's efficiency in managing its operations.
1. Inventory Turnover:
- Cleveland-Cliffs' inventory turnover has improved steadily over the years, from 0.80 in March 2020 to 4.79 in March 2024. This indicates that the company is selling its inventory at a faster rate, which is positive for managing working capital and reducing holding costs.
2. Receivables Turnover:
- The receivables turnover ratio has also shown a consistent increase over time, reflecting the company's ability to efficiently collect payments from its customers. The ratio increased from 3.52 in March 2020 to 12.17 in December 2024, indicating effective credit management.
3. Payables Turnover:
- Cleveland-Cliffs' payables turnover ratio has shown some fluctuations but has generally remained stable. The company has been able to manage its payables effectively, with the ratio ranging from 2.08 in March 2020 to 10.39 in March 2024. This suggests good relationships with suppliers and effective working capital management.
4. Working Capital Turnover:
- The working capital turnover ratio has shown an upward trend over the years, indicating that Cleveland-Cliffs is generating more revenue per unit of working capital. The ratio increased from 1.29 in March 2020 to 7.31 in June 2024, showing improved operational efficiency and effective utilization of resources.
Overall, Cleveland-Cliffs Inc's activity ratios demonstrate the company's efficient management of inventory, receivables, payables, and working capital, reflecting positively on its operational performance and financial health.
Average number of days
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 93.58 | 75.81 | 73.37 | 76.18 | 75.93 | 78.22 | 79.92 | 83.33 | 88.75 | 100.92 | 111.34 | 116.31 | 115.02 | 115.56 | 135.58 | 161.18 | 253.74 | 175.99 | 279.10 | 456.39 |
| Days of sales outstanding (DSO) | days | 29.98 | 28.93 | 30.80 | 31.13 | 30.53 | 35.32 | 38.03 | 36.22 | 31.12 | 36.06 | 39.69 | 43.56 | 38.51 | 49.38 | 57.91 | 66.95 | 81.33 | 66.60 | 78.24 | 103.66 |
| Number of days of payables | days | 36.89 | 35.49 | 36.34 | 35.12 | 35.74 | 35.36 | 35.77 | 36.78 | 37.82 | 43.00 | 49.93 | 47.49 | 45.96 | 46.89 | 52.74 | 71.45 | 104.40 | 69.68 | 72.86 | 175.29 |
Cleveland-Cliffs Inc's activity ratios indicate the efficiency of the company in managing its inventory, collecting receivables, and paying its suppliers.
1. Days of Inventory on Hand (DOH): The trend in DOH shows a significant improvement from 456.39 days on March 31, 2020, to 75.81 days on September 30, 2024. This indicates a more efficient management of inventory levels over time, with the company managing to reduce the number of days it holds inventory before selling it.
2. Days of Sales Outstanding (DSO): The DSO metric demonstrates the company's effectiveness in collecting receivables. The trend shows a decrease from 103.66 days on March 31, 2020, to 29.98 days on December 31, 2024. This suggests improved efficiency in collecting payments from customers within a shorter period, enhancing cash flow management.
3. Number of Days of Payables: This ratio reflects how long it takes for the company to pay its suppliers. The trend indicates a decrease from 175.29 days on March 31, 2020, to 36.89 days on December 31, 2024. A decreasing trend in this ratio signifies that the company is taking fewer days to settle its payables, possibly benefiting from better negotiation terms or improved cash flow management.
Overall, the declining trends in all three activity ratios suggest that Cleveland-Cliffs Inc has been successful in optimizing its working capital management, leading to improved efficiency in inventory turnover, receivables collection, and payables management.
Long-term
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Fixed asset turnover | 1.93 | 2.30 | 2.41 | 2.50 | 2.47 | 2.48 | 2.48 | 2.49 | 2.53 | 2.58 | 2.61 | 2.48 | 2.23 | 1.93 | 1.45 | 1.00 | 0.61 | 0.80 | 0.56 | 0.48 |
| Total asset turnover | 0.92 | 1.19 | 1.24 | 1.27 | 1.25 | 1.21 | 1.20 | 1.20 | 1.23 | 1.18 | 1.18 | 1.13 | 1.08 | 0.96 | 0.73 | 0.53 | 0.32 | 0.43 | 0.30 | 0.25 |
Long-term activity ratios provide insights into how efficiently Cleveland-Cliffs Inc is utilizing its assets over an extended period.
1. Fixed Asset Turnover: This ratio measures how effectively the company is generating revenue from its fixed assets. The trend shows an improvement over the years, from 0.48 in March 2020 to 2.30 in September 2024. The company's ability to generate revenue from fixed assets has generally been increasing, with a peak at 2.61 in June 2022 before slightly declining. The high ratio indicates that Cleveland-Cliffs has been utilizing its fixed assets more efficiently to drive sales.
2. Total Asset Turnover: This ratio evaluates how well the company is using all its assets to generate revenue. The total asset turnover ratio also shows a positive trend, increasing from 0.25 in March 2020 to 0.92 in December 2024. The ratio climbed steadily from 0.25 in March 2020 to 1.25 in December 2023 before dropping slightly. The company's ability to generate sales from its total assets has been improving, indicating more efficient asset utilization over the long term.
In conclusion, the trends in both fixed asset turnover and total asset turnover ratios for Cleveland-Cliffs Inc show an overall positive trajectory, suggesting increased efficiency in utilizing its assets to drive revenue generation over the long term.