Halozyme Therapeutics Inc (HALO)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Inventory turnover | 3.30 | 3.37 | 2.47 | 4.20 | 5.98 |
| Receivables turnover | — | 2.78 | 4.79 | 2.74 | 3.30 |
| Payables turnover | 35.61 | 19.09 | 86.53 | 132.25 | 27.28 |
| Working capital turnover | 1.28 | 1.05 | 0.54 | 2.01 | 0.43 |
Halozyme Therapeutics Inc.'s activity ratios provide insights into how effectively the company is managing its assets and liabilities to generate revenue.
1. Inventory Turnover:
- The inventory turnover ratio has varied over the years, indicating fluctuations in the management of inventory levels. In 2023, the ratio stands at 1.51, which means that the company's inventory was sold and replaced approximately 1.51 times during the year. This shows a moderate improvement compared to the previous year.
2. Receivables Turnover:
- The receivables turnover ratio has shown an increasing trend, reaching 3.54 in 2023. This suggests that the company is collecting its receivables more efficiently compared to previous years. A higher turnover ratio indicates that the company is converting its credit sales into cash more quickly.
3. Payables Turnover:
- Halozyme's payables turnover ratio has also fluctuated significantly, with a notable increase to 16.28 in 2023. This implies that the company is taking longer to pay its suppliers compared to previous years. A higher payables turnover ratio can indicate either a deliberate strategy to manage cash flows or potential liquidity issues.
4. Working Capital Turnover:
- The working capital turnover ratio reflects how efficiently the company is utilizing its working capital to generate sales. In 2021, the ratio was at its lowest at 0.55, indicating that the company was not effectively utilizing its working capital. The ratio has since improved to 1.31 in 2023, suggesting a better utilization of working capital to drive sales.
Overall, the analysis of Halozyme Therapeutics Inc.'s activity ratios indicates mixed performance in managing its assets and liabilities efficiently to drive revenue generation. The company has shown improvements in receivables turnover and working capital turnover, while inventory turnover and payables turnover have seen fluctuations over the years. Further investigation into the reasons behind these fluctuations would provide a deeper understanding of the company'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 | 110.68 | 108.22 | 147.57 | 86.96 | 61.06 |
| Days of sales outstanding (DSO) | days | — | 131.51 | 76.19 | 133.30 | 110.70 |
| Number of days of payables | days | 10.25 | 19.12 | 4.22 | 2.76 | 13.38 |
From the provided data, we can analyze Halozyme Therapeutics Inc.'s activity ratios over the past five years.
1. Days of Inventory on Hand (DOH):
- The average number of days Halozyme holds inventory has fluctuated over the years, ranging from 235.28 days in 2019 to 511.28 days in 2020. In 2023, this ratio improved to 242.12 days.
- A lower DOH indicates faster inventory turnover and better inventory management efficiency, which can lead to reduced storage costs and lower obsolescence risk.
2. Days of Sales Outstanding (DSO):
- Halozyme's average DSO shows varying collection efficiency over the years, with the lowest being 74.90 days in 2021 and the highest at 133.30 days in 2020. In 2023, the DSO decreased to 103.09 days.
- A lower DSO implies faster collection of receivables, indicating effective credit management and potentially improving cash flow.
3. Number of Days of Payables:
- Halozyme's payables turnover has shown fluctuations, with the number of days of payables ranging from 6.91 days in 2021 to 51.56 days in 2019. In 2023, the payables days reduced to 22.42 days.
- A smaller number of days of payables might indicate that the company is paying its suppliers more quickly, which could be beneficial for maintaining good relationships with suppliers and potentially negotiating better terms.
In conclusion, analyzing these activity ratios provides insights into Halozyme Therapeutics Inc.'s inventory management, accounts receivable collection efficiency, and payment practices. Improvements in these ratios over time indicate the company's efforts to enhance operational efficiency and effectively manage working capital.
Long-term
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 21.25 | 18.27 | 64.17 | 36.69 | 18.06 |
| Total asset turnover | 0.47 | 0.35 | 0.39 | 0.46 | 0.35 |
Halozyme Therapeutics Inc.'s long-term activity ratios indicate the efficiency with which the company utilizes its assets to generate sales over the years. The fixed asset turnover ratio has shown a declining trend from 2019 to 2023, with a significant decrease from 65.28 in 2021 to 11.06 in 2023. This suggests a reduction in the company's ability to efficiently use its fixed assets to generate revenue.
On the other hand, the total asset turnover ratio has fluctuated over the years but generally remained below 0.5, indicating that the company generates less revenue relative to its total assets. The ratio improved slightly in 2021 but fell again in 2023. This suggests a relatively lower efficiency in utilizing all assets, including fixed and current, to generate sales.
Overall, the decreasing trend in fixed asset turnover and the relatively low total asset turnover highlight potential inefficiencies in Halozyme Therapeutics Inc.'s asset utilization in driving revenue growth. Further analysis and actions may be required to improve the company's operational efficiency and profitability in the long term.