Helmerich and Payne Inc (HP)
Activity ratios
Short-term
Turnover ratios
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | |
|---|---|---|---|---|---|
| Inventory turnover | 16.13 | 20.64 | 18.58 | 14.48 | 18.69 |
| Receivables turnover | 6.59 | 7.11 | 4.49 | 5.32 | 9.21 |
| Payables turnover | 14.07 | 14.86 | 12.87 | 16.91 | 53.40 |
| Working capital turnover | 3.70 | 4.89 | 3.39 | 1.69 | 2.38 |
The activity ratios of Helmerich and Payne Inc provide insight into the efficiency of the company's operations.
1. Inventory turnover: The inventory turnover ratio has shown a fluctuating trend over the past five years, ranging from 14.48 to 20.64. A higher turnover indicates that the company is selling its inventory more frequently. The decrease in 2021 followed by an increase in subsequent years could suggest improved inventory management or changes in sales patterns.
2. Receivables turnover: The receivables turnover ratio has also varied over the years, with values between 4.49 and 9.21. This ratio indicates how quickly the company collects payments from its customers. The decrease in 2022 followed by a recovery in 2023 and 2024 may reflect changes in credit terms or customer payment behavior.
3. Payables turnover: The payables turnover ratio has seen significant fluctuations, with a sharp decline in 2020 followed by fluctuations between 12.87 and 53.40. A higher ratio suggests that the company is paying its suppliers more frequently. The drastic fluctuation in 2020 could indicate changes in payment practices or supplier relationships.
4. Working capital turnover: The working capital turnover ratio has also varied, with values between 1.69 and 4.89. This ratio shows how effectively the company is using its working capital to generate sales. An increase in the ratio indicates improved efficiency in utilizing working capital to drive revenue.
Overall, the activity ratios of Helmerich and Payne Inc reflect fluctuations in operational efficiency and management of inventory, receivables, and payables over the past five years. Monitoring these ratios can help to identify trends and potential areas for improvement in the company's operational performance.
Average number of days
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 22.63 | 17.68 | 19.65 | 25.20 | 19.52 |
| Days of sales outstanding (DSO) | days | 55.43 | 51.36 | 81.32 | 68.56 | 39.63 |
| Number of days of payables | days | 25.94 | 24.56 | 28.36 | 21.59 | 6.83 |
Activity ratios provide insights into the efficiency of a company's operations. Let's analyze the activity ratios of Helmerich and Payne Inc over the past five years:
1. Days of Inventory on Hand (DOH): This ratio measures how long, on average, inventory is held before it is sold. Helmerich and Payne Inc's DOH has fluctuated over the past five years, ranging from 17.68 days to 25.20 days. A lower DOH indicates faster inventory turnover, which can be positive as it signifies efficient inventory management. The increase in DOH from 2023 to 2024 may indicate a change in inventory management practices or market demand.
2. Days of Sales Outstanding (DSO): DSO reflects the average number of days it takes for the company to collect its accounts receivable. Helmerich and Payne Inc's DSO has also varied over the years, with a significant increase in 2022 compared to the previous and subsequent years. A higher DSO suggests slower collection of receivables, which can impact cash flow. The decreasing trend from 2022 to 2023 and the subsequent increase in 2024 may indicate changes in credit policies or customer payment behavior.
3. Number of Days of Payables: This ratio represents the average number of days it takes for the company to pay its suppliers. Helmerich and Payne Inc's days of payables have generally increased over the years, with a notable jump from 2020 to 2021. A longer payment period can benefit the company by preserving cash flow but may strain relationships with suppliers if extended too far. The increase in days of payables from 2022 to 2023 followed by a decrease in 2024 could indicate adjustments in payment terms or supplier relationships.
Overall, analyzing these activity ratios can provide valuable insights into Helmerich and Payne Inc's operational efficiency and liquidity management over the past five years.
Long-term
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 0.91 | 0.98 | 0.70 | 0.39 | 0.49 |
| Total asset turnover | 0.48 | 0.66 | 0.47 | 0.24 | 0.37 |
The fixed asset turnover ratio for Helmerich and Payne Inc has fluctuated over the past five years, indicating varying levels of efficiency in generating revenues from fixed assets. The ratio decreased from 0.98 in 2023 to 0.91 in 2024, suggesting a slight decline in the company's ability to utilize its fixed assets to generate sales. However, the ratio remains relatively stable over the period, indicating a consistent level of efficiency in utilizing fixed assets.
In contrast, the total asset turnover ratio reflects a more significant fluctuation in the company's ability to generate sales from all assets. The ratio fluctuated between 0.24 in 2021 and 0.66 in 2023, demonstrating a varying level of efficiency in generating revenue from total assets. In 2024, the total asset turnover ratio decreased to 0.48, indicating a decline in the company's overall efficiency in utilizing all assets to generate sales.
Overall, the fixed asset turnover ratio suggests a relatively stable efficiency in utilizing fixed assets, while the total asset turnover ratio highlights more significant fluctuations in the company's overall efficiency in generating sales from all assets over the past five years.