Capri Holdings Ltd (CPRI)

Short-term

Turnover ratios

Inventory Turnover:
- The inventory turnover ratio for Capri Holdings Ltd has shown some fluctuation over the years, ranging from 1.56 to 2.25.
- A higher inventory turnover ratio indicates better efficiency in managing inventory and converting it into sales.
- The increase in the ratio from 1.56 to 2.25 from June 30, 2022, to March 31, 2024, suggests an improvement in inventory management efficiency.

Receivables Turnover:
- The receivables turnover ratio for Capri Holdings Ltd has varied significantly over the years, with values ranging from 10.51 to 16.99.
- A higher receivables turnover ratio indicates that the company is collecting its accounts receivable more frequently.
- The ratio peaked at 16.99 on June 30, 2023, suggesting effective management of accounts receivable during that period.

Payables Turnover:
- The payables turnover ratio for Capri Holdings Ltd has shown some fluctuations, varying from 2.86 to 5.45.
- A higher payables turnover ratio implies that the company is paying its suppliers more frequently.
- The ratio peaked at 5.45 on September 30, 2022, indicating that the company was paying its payables at a faster rate during that period.

Working Capital Turnover:
- The working capital turnover ratio for Capri Holdings Ltd fluctuated significantly over the years, with values ranging from 7.19 to 81.58.
- A higher working capital turnover ratio signifies that the company is effectively using its working capital to generate sales.
- The ratio peaked at 81.58 on September 30, 2020, indicating a strong utilization of working capital to drive sales during that period.

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Average number of days

Based on the provided data, we will analyze the activity ratios for Capri Holdings Ltd:

1. Days of Inventory on Hand (DOH):
- Capri Holdings' DOH has shown some fluctuations over the years, ranging from a low of 162.13 days on June 30, 2021, to a peak of 234.14 days on June 30, 2022.
- A decreasing trend is observed in DOH from June 30, 2022, to March 31, 2024, indicating more efficient management of inventory during this period.
- However, there is a slight increase in DOH on June 30, 2024, and December 31, 2024, which might suggest challenges in inventory management during those periods.

2. Days of Sales Outstanding (DSO):
- The DSO metric for Capri Holdings has seen fluctuations over time, with a low of 14.35 days on June 30, 2020, and a high of 34.74 days on December 31, 2020.
- There is a general decreasing trend in DSO from December 31, 2020, to December 31, 2024, indicating an improvement in the company's ability to collect revenues from customers promptly.

3. Number of Days of Payables:
- Capri Holdings' days of payables have fluctuated over the years, with the lowest figure of 66.96 days on September 30, 2022, and the highest figure of 127.74 days on March 31, 2021.
- A decreasing trend is observed in the number of days of payables from March 31, 2021, to March 31, 2024, suggesting that the company has been paying off its suppliers more promptly during this period.

In conclusion, Capri Holdings' activity ratios indicate mixed performance in managing inventory, collecting receivables, and paying off payables. The company should focus on maintaining an optimal level of inventory, efficient collection of receivables, and timely payments to suppliers to improve its operational efficiency and financial performance.

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Long-term

Capri Holdings Ltd's fixed asset turnover ratio has shown some fluctuations over the years. The ratio ranged from a high of 12.50 in September 2022 to a low of 2.51 in June 2021. This ratio measures how efficiently the company is utilizing its fixed assets to generate sales revenue.

On the other hand, the total asset turnover ratio, which indicates the efficiency of the company in utilizing all its assets to generate sales, has also fluctuated. The ratio ranged from 0.52 in December 2020 to 0.82 in September 2022.

Overall, it is important to analyze these ratios in conjunction with the company's operational and strategic activities to understand the reasons behind these fluctuations and assess the company's long-term asset utilization efficiency.