MDU Resources Group Inc (MDU)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Inventory turnover | 26.39 | 46.17 | 15.04 | 13.81 | 15.40 |
| Receivables turnover | — | — | — | — | — |
| Payables turnover | — | — | — | — | — |
| Working capital turnover | — | 16.17 | 13.11 | 12.38 | 14.80 |
Based on the provided data for MDU Resources Group Inc's activity ratios, we can analyze the following:
1. Inventory Turnover:
- The inventory turnover ratio measures how many times a company's inventory is sold and replaced over a period.
- MDU Resources' inventory turnover has varied over the years, ranging from 13.81 to 46.17.
- A higher inventory turnover indicates efficient inventory management and faster sales of products.
2. Receivables Turnover:
- The receivables turnover ratio indicates how many times a company collects its accounts receivable during a period.
- The data shows that receivables turnover is not available for the years presented, which may suggest that MDU Resources does not report this metric or has minimal accounts receivable turnover.
3. Payables Turnover:
- The payables turnover ratio reflects how quickly a company pays its suppliers.
- Similar to receivables turnover, payables turnover data is not provided, indicating a lack of information related to the speed of paying suppliers.
4. Working Capital Turnover:
- The working capital turnover ratio measures how effectively a company uses its working capital to generate sales.
- Over the years, MDU Resources' working capital turnover has ranged from 12.38 to 16.17, indicating the company's ability to efficiently utilize its working capital in generating revenue.
In conclusion, MDU Resources Group Inc has demonstrated varying levels of efficiency in managing its inventory and working capital, as evidenced by fluctuations in inventory turnover and working capital turnover ratios. However, limited information on receivables and payables turnover ratios restricts a comprehensive analysis of the company's overall activity 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 | 13.83 | 7.90 | 24.27 | 26.42 | 23.69 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
The days of inventory on hand (DOH) ratio for MDU Resources Group Inc has shown fluctuation over the years, starting at 23.69 days in December 2020 and reaching its peak at 26.42 days in December 2021 before decreasing to 13.83 days by December 2024. This ratio indicates the average number of days the company holds inventory before it is sold, with lower values generally considered more favorable as they suggest efficient inventory management.
In contrast, the days of sales outstanding (DSO) and number of days of payables ratios are not provided in the data, indicating that these particular activity ratios are not available for analysis. DSO would typically reflect the average number of days it takes for the company to collect payments from its customers, while the number of days of payables would show the average number of days the company takes to make payments to its suppliers.
Overall, based on the DOH values provided, it appears that MDU Resources Group Inc has been effectively managing its inventory levels over the years, with a noticeable improvement in inventory turnover efficiency as indicated by the decreasing trend in days of inventory on hand. However, a comprehensive assessment of the company's overall liquidity and operating efficiency would require analysis of additional activity ratios such as DSO and number of days of payables.
Long-term
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Fixed asset turnover | — | — | 1.14 | 0.99 | 1.07 |
| Total asset turnover | 0.25 | 0.59 | 0.72 | 0.64 | 0.69 |
Long-term activity ratios provide insight into how efficiently a company utilizes its assets to generate revenue. The fixed asset turnover ratio measures how effectively a company generates sales from its fixed assets.
Looking at MDU Resources Group Inc's fixed asset turnover ratio, we observe a slight fluctuation over the years. The ratio was 1.07 in 2020, declined to 0.99 in 2021, increased to 1.14 in 2022, and there is no data available for 2023 and 2024. The increase in 2022 indicates a more efficient utilization of fixed assets to generate sales.
Total asset turnover ratio, on the other hand, assesses the company's ability to generate revenue from all of its assets. MDU Resources Group Inc's total asset turnover ratio decreased from 0.69 in 2020 to 0.64 in 2021, then increased to 0.72 in 2022, and saw a notable drop to 0.59 in 2023, followed by a significant decrease to 0.25 in 2024. The declines in 2023 and 2024 suggest potential inefficiencies in utilizing total assets to generate revenue, which could be a point of concern.
Overall, while the fixed asset turnover ratio has shown some improvement, the total asset turnover ratio has exhibited more volatility over the years, indicating fluctuations in the company's overall asset utilization efficiency. Monitoring these ratios can help assess the company's operational performance and asset management strategies over time.