MGP Ingredients Inc (MGPI)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Inventory turnover | 1.14 | 1.18 | 1.35 | 1.46 | 1.53 | 1.55 | 1.55 | 1.74 | 1.83 | 1.87 | 1.81 | 1.83 | 1.74 | 1.60 | 1.48 | 2.18 | 2.10 | 2.09 | 1.97 | 2.03 |
| Receivables turnover | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Payables turnover | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Working capital turnover | 1.55 | 1.64 | 1.71 | 1.89 | 2.09 | 1.96 | 1.99 | 2.11 | 2.24 | 2.23 | 2.23 | 2.30 | 2.25 | 2.11 | 1.80 | 2.32 | 2.34 | 2.19 | 2.11 | 1.85 |
MGP Ingredients Inc's inventory turnover ratio has exhibited some fluctuations over the years, ranging from a low of 1.14 to a high of 2.18. Generally, a higher inventory turnover is preferred as it indicates that the company is efficiently managing its inventory by selling goods quickly. However, MGP's inventory turnover has shown a downward trend since its peak in March 2021, which may suggest potential issues with inventory management or slowing sales.
The receivables turnover ratio, which measures how efficiently a company is collecting on its receivables, is not available for MGP Ingredients Inc. The lack of data for this ratio makes it challenging to assess the company's effectiveness in collecting outstanding payments from customers.
Similarly, the payables turnover ratio, which reflects how quickly a company pays its suppliers, is also not provided for MGP Ingredients Inc. This ratio is crucial as it can indicate the company's relationships with suppliers and its liquidity position.
Moving on to the working capital turnover ratio, MGP Ingredients Inc's ability to generate sales from its working capital has varied between 1.55 to 2.34. A higher value for this ratio generally indicates efficient use of working capital. The fluctuations in this ratio suggest that the company's ability to generate sales from its working capital has been inconsistent over time.
In conclusion, while MGP Ingredients Inc's inventory turnover and working capital turnover ratios provide some insights into its operational efficiency, the lack of data for receivables turnover and payables turnover ratios limits a comprehensive analysis of the company's overall activity performance.
Average number of days
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 319.20 | 308.21 | 270.82 | 250.52 | 238.06 | 235.87 | 235.11 | 209.80 | 199.88 | 195.10 | 202.17 | 199.36 | 209.86 | 228.16 | 247.10 | 167.32 | 173.46 | 174.65 | 184.82 | 179.92 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
Based on the provided data, we can analyze MGP Ingredients Inc's activity ratios, specifically focusing on the Days of Inventory on Hand (DOH) metric. The DOH measures how many days on average it takes for the company to sell its inventory.
From March 31, 2020, to December 31, 2024, MGP Ingredients Inc's DOH fluctuated within a range of 167.32 days to 319.20 days. The trend shows an increase in the DOH from 167.32 days on March 31, 2021, to 319.20 days on December 31, 2024. This suggests that the company took longer to sell its inventory over this period, which may indicate potential issues with inventory management, demand forecasting, or production inefficiencies.
The increasing trend in DOH could lead to increased carrying costs, obsolete inventory, and potential liquidity challenges due to tied-up capital in unsold goods. MGP Ingredients Inc should closely monitor and optimize its inventory levels to ensure efficient operations and better cash flow management.
It is important for the company to analyze the underlying reasons for the increase in DOH and implement strategies to improve inventory turnover rates, such as enhancing supply chain efficiency, adjusting production schedules, or introducing better inventory control systems.
In conclusion, monitoring the Days of Inventory on Hand ratio can provide valuable insights into MGP Ingredients Inc's operational efficiency and inventory management practices, helping the company make informed decisions to enhance profitability and overall performance.
Long-term
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Fixed asset turnover | — | — | — | — | — | — | 3.20 | 3.27 | 3.32 | 3.44 | 3.46 | 3.44 | 3.02 | 2.84 | 2.45 | 2.92 | 3.00 | 2.99 | 2.91 | 2.90 |
| Total asset turnover | 0.50 | 0.51 | 0.55 | 0.58 | 0.60 | 0.59 | 0.57 | 0.67 | 0.68 | 0.67 | 0.66 | 0.66 | 0.60 | 0.55 | 0.48 | 1.06 | 1.08 | 1.07 | 1.05 | 0.97 |
The fixed asset turnover ratio for MGP Ingredients Inc has been relatively stable over the years, ranging from 2.45 to 3.46. This indicates that the company is efficiently utilizing its fixed assets to generate sales.
On the other hand, the total asset turnover ratio has shown more volatility, with a decline from 1.08 in December 2020 to 0.50 in December 2024. This suggests that the company's overall efficiency in generating sales from its total assets has decreased over the years.
In conclusion, MGP Ingredients Inc's fixed asset turnover ratio reflects consistent efficiency in utilizing fixed assets, while the total asset turnover ratio indicates a decline in the efficiency of using all assets to generate sales. These ratios provide valuable insights into the company's operational performance and asset utilization over the years.