Kaiser Aluminum Corporation (KALU)

Short-term

Turnover ratios

Based on the data provided for Kaiser Aluminum Corporation, we can analyze the activity ratios as follows:

1. Inventory Turnover:
- The inventory turnover ratio measures how efficiently the company manages its inventory. A higher ratio indicates a faster turnover of inventory.
- Kaiser Aluminum Corporation's inventory turnover has ranged from 5.34 to 6.54 over the five-year period. A general decrease in this ratio may suggest a slower turnover of inventory, which could potentially lead to excess inventory levels or inefficiencies in managing inventory.

2. Receivables Turnover:
- The receivables turnover ratio evaluates how effectively a company is collecting on its credit sales. A higher ratio implies quicker collection of receivables.
- Unfortunately, the data provided for Kaiser Aluminum Corporation indicates that the receivables turnover ratio is not available for any of the years. Without this information, it is challenging to assess the company's effectiveness in collecting receivables.

3. Payables Turnover:
- The payables turnover ratio reflects how efficiently a company pays its suppliers and other short-term obligations. A higher ratio indicates faster payment to creditors.
- Similar to receivables turnover, the information for payables turnover is not provided for any of the years, making it difficult to analyze Kaiser Aluminum Corporation's payment practices to its suppliers.

4. Working Capital Turnover:
- The working capital turnover ratio measures how efficiently the company utilizes its working capital to generate sales. A higher ratio signifies better utilization of working capital.
- Kaiser Aluminum Corporation's working capital turnover has shown an increasing trend from 1.22 to 5.25 during the five-year period. This indicates that the company is utilizing its working capital more efficiently to generate sales, which is a positive sign of operational effectiveness and financial management.

In conclusion, while Kaiser Aluminum Corporation demonstrates improving efficiency in utilizing working capital, the lack of data for receivables and payables turnover ratios limits a comprehensive analysis of the company's overall activity and efficiency in managing its working capital cycle.

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Average number of days

The activity ratios for Kaiser Aluminum Corporation indicate the efficiency of the company in managing its inventory, sales receivables, and payables.

1. Days of Inventory on Hand (DOH):
- The company's average days of inventory on hand increased from 55.84 days in 2020 to 68.35 days in 2024. This suggests that the company is holding inventory for a longer period. A higher DOH may indicate inefficiencies in inventory management, leading to higher carrying costs and potentially obsolete inventory.

2. Days of Sales Outstanding (DSO):
- The data provided does not show any figures for Days of Sales Outstanding (DSO) for Kaiser Aluminum Corporation. DSO is a measure of how long it takes for the company to collect its accounts receivable. Without this data, it is challenging to assess the efficiency of the company in collecting receivables.

3. Number of Days of Payables:
- Similarly, there is no information available for the Number of Days of Payables for the company. This ratio would provide insights into how long the company takes to pay its suppliers. A longer payables period can indicate favorable terms with suppliers but could also signal cash flow issues if extended excessively.

Overall, based on the available data, Kaiser Aluminum Corporation seems to be facing challenges in managing its inventory efficiently. However, without information on DSO and payables days, a holistic assessment of the company's working capital management is limited.

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Long-term

The Fixed Asset Turnover ratio measures how efficiently a company is utilizing its fixed assets to generate sales. In the case of Kaiser Aluminum Corporation, we observe a positive trend in this ratio over the years, increasing from 1.87 in 2020 to 3.38 in 2022. This suggests that the company is becoming more efficient in generating sales relative to its investment in fixed assets.

On the other hand, the Total Asset Turnover ratio indicates how effectively a company is using its total assets to generate revenue. Kaiser Aluminum's Total Asset Turnover ratio has also been improving, rising from 0.63 in 2020 to 1.31 in 2024. This signifies that the company is generating more revenue per dollar of total assets employed.

Overall, the increasing trend in both the Fixed Asset Turnover and Total Asset Turnover ratios reflects positively on Kaiser Aluminum Corporation's ability to make productive use of its assets in generating sales, which is indicative of operational efficiency and potentially improving financial performance.