Integra LifeSciences Holdings (IART)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Inventory turnover | 3.77 | 3.72 | 4.12 | 4.33 | 4.11 |
| Receivables turnover | 5.91 | 5.73 | 5.72 | 6.62 | 5.76 |
| Payables turnover | 19.63 | 15.70 | 13.08 | 22.23 | 23.34 |
| Working capital turnover | 10.08 | 1.98 | 1.79 | 1.89 | 1.55 |
Integra LifeSciences Holdings' activity ratios provide insights into how efficiently the company manages its inventory, receivables, payables, and working capital.
1. Inventory Turnover: Integra's inventory turnover has remained relatively stable over the years, ranging from 3.72 to 4.33. This suggests that the company efficiently manages its inventory, with a higher turnover indicating quicker sales of inventory.
2. Receivables Turnover: The receivables turnover reflects how quickly the company collects on credit sales. Integra's receivables turnover has varied but generally stayed within a range of 5.72 to 6.62, indicating a moderate efficiency in collecting receivables.
3. Payables Turnover: The payables turnover measures how quickly the company pays its suppliers. Integra's payables turnover has fluctuated, with a notable decrease in 2022, possibly indicating a change in payment terms or supplier relationships.
4. Working Capital Turnover: The working capital turnover ratio indicates how effectively the company is using its working capital to generate sales. Integra's working capital turnover has shown a significant spike in 2024 to 10.08, suggesting a potentially more effective utilization of working capital that year.
Overall, Integra LifeSciences Holdings displays a generally efficient management of its activity ratios, with some fluctuations over the years that may warrant further investigation to understand the underlying reasons for the changes in efficiency.
Average number of days
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 96.70 | 98.12 | 88.69 | 84.26 | 88.82 |
| Days of sales outstanding (DSO) | days | 61.79 | 63.68 | 63.83 | 55.16 | 63.39 |
| Number of days of payables | days | 18.59 | 23.25 | 27.90 | 16.42 | 15.64 |
Based on the provided data, let's analyze the activity ratios for Integra LifeSciences Holdings:
1. Days of Inventory on Hand (DOH):
- The company's DOH indicates how many days, on average, it takes to sell its inventory.
- The trend shows that DOH decreased slightly from 88.82 days in 2020 to 84.26 days in 2021 but then increased to 98.12 days in 2023 before dropping to 96.70 days in 2024.
- Generally, a lower DOH is preferred as it suggests efficient inventory management.
2. Days of Sales Outstanding (DSO):
- DSO represents the average number of days it takes for the company to collect its accounts receivable.
- The data shows a decreasing trend in DSO from 63.39 days in 2020 to 55.16 days in 2021 before stabilizing around 61-63 days in the following years.
- A lower DSO indicates faster collections, which is favorable for managing liquidity and cash flow.
3. Number of Days of Payables:
- This metric reflects how long the company takes to pay its suppliers.
- The number of days of payables increased significantly from 15.64 days in 2020 to 27.90 days in 2022 but then decreased to 18.59 days in 2024.
- A longer period of payables may signify better cash flow management, although excessively long payables could strain relationships with suppliers.
In summary, Integra LifeSciences Holdings has shown variations in its activity ratios over the years. The company managed to improve its DSO, indicating efficient collections, while its DOH fluctuated but generally remained within a reasonable range. The increase in the number of days of payables in 2022 may have been a strategic move to enhance cash flow, which seemed to stabilize in the subsequent years. Monitoring and managing these activity ratios will be crucial for the company's operational efficiency and financial health.
Long-term
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 3.97 | 4.37 | 4.84 | 4.92 | 4.52 |
| Total asset turnover | 0.40 | 0.39 | 0.39 | 0.41 | 0.36 |
Integra LifeSciences Holdings has shown a consistent improvement in its fixed asset turnover ratio from 4.52 in 2020 to 4.92 in 2021, before slightly decreasing to 4.84 in 2022, and then further declining to 4.37 in 2023 and 3.97 in 2024. This indicates that the company generated $4.92 in sales for every $1 of fixed assets in 2021, but this efficiency has gradually decreased in the following years.
In terms of the total asset turnover ratio, Integra LifeSciences Holdings has shown a slight increase from 0.36 in 2020 to 0.41 in 2021, before stabilizing around 0.39 in 2022 and 2023, and then marginally increasing to 0.40 in 2024. This ratio measures the company's ability to generate sales from its total assets, and the increase over the years indicates a positive trend in utilizing its assets to generate revenue.
Overall, while the fixed asset turnover ratio has fluctuated, the total asset turnover ratio has shown a more consistent performance, indicating that Integra LifeSciences Holdings has been effectively utilizing its assets to generate revenue, albeit with some variability in efficiency in using its fixed assets.