Norwegian Cruise Line Holdings Ltd (NCLH)
Activity ratios
Short-term
Turnover ratios
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Inventory turnover | 48.33 | 45.51 | 47.74 | 47.94 | 43.00 | 37.01 | 31.16 | 27.64 | 28.50 | 27.37 | 29.43 | 32.51 | 65.73 | 78.34 | 90.12 | 96.56 | 67.15 | 66.71 | 68.00 | 67.14 |
| Receivables turnover | 27.79 | 30.28 | 28.97 | 20.01 | 11.41 | 8.81 | 3.30 | 1.76 | 0.55 | 0.16 | 0.06 | 1.40 | 62.67 | 35.17 | 63.04 | 65.77 | 86.08 | 94.03 | 83.85 | 108.21 |
| Payables turnover | 43.70 | 47.70 | 49.52 | 34.42 | 27.96 | 40.83 | 47.95 | 42.74 | 14.45 | 31.18 | 24.48 | 29.70 | 65.14 | 54.66 | 15.29 | 22.67 | 63.59 | 87.14 | 81.62 | 90.74 |
| Working capital turnover | — | — | — | — | — | — | — | — | — | 0.46 | 0.02 | 0.01 | 0.78 | 8.68 | 28.04 | — | — | — | — | — |
The activity ratios of Norwegian Cruise Line Holdings Ltd provide valuable insights into the company's operational efficiency and management of its resources.
1. Inventory turnover: This ratio measures how efficiently the company manages its inventory by assessing how many times the inventory is sold and replaced within a specific period. The increasing trend in inventory turnover from Q1 2022 to Q4 2023 indicates a positive development in the company's ability to sell its inventory quickly. Higher inventory turnover ratios suggest effective inventory management and lower carrying costs.
2. Receivables turnover: The receivables turnover ratio reflects the speed at which the company collects outstanding receivables from its customers. The substantial improvement in receivables turnover from Q1 2022 to Q4 2023 signals an enhanced collection process and better credit terms for customers. A higher receivables turnover ratio indicates efficient credit management and timely collection of funds.
3. Payables turnover: This ratio assesses how efficiently the company pays its suppliers relative to the credit terms provided. The fluctuating payables turnover ratios across quarters suggest variations in the company's payment policies. Generally, a higher payables turnover ratio signifies quicker payment to suppliers and better cash flow management.
4. Working capital turnover: The absence of data for the working capital turnover ratio limits our ability to evaluate how well the company utilizes its working capital to generate sales. Working capital turnover measures the efficiency of using working capital to support business operations. A high working capital turnover ratio may indicate effective utilization of resources and strong business performance.
In conclusion, the analysis of Norwegian Cruise Line Holdings Ltd's activity ratios highlights positive trends in inventory turnover and receivables turnover, indicating improved operational efficiency and cash flow management. However, fluctuations in payables turnover ratios suggest some variability in the company's payment practices. The lack of data for the working capital turnover ratio limits a comprehensive assessment of the company's overall working capital management effectiveness.
Average number of days
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 7.55 | 8.02 | 7.65 | 7.61 | 8.49 | 9.86 | 11.71 | 13.21 | 12.81 | 13.33 | 12.40 | 11.23 | 5.55 | 4.66 | 4.05 | 3.78 | 5.44 | 5.47 | 5.37 | 5.44 |
| Days of sales outstanding (DSO) | days | 13.14 | 12.05 | 12.60 | 18.24 | 31.99 | 41.41 | 110.63 | 207.23 | 669.68 | 2,281.40 | 6,545.65 | 261.59 | 5.82 | 10.38 | 5.79 | 5.55 | 4.24 | 3.88 | 4.35 | 3.37 |
| Number of days of payables | days | 8.35 | 7.65 | 7.37 | 10.60 | 13.05 | 8.94 | 7.61 | 8.54 | 25.26 | 11.70 | 14.91 | 12.29 | 5.60 | 6.68 | 23.87 | 16.10 | 5.74 | 4.19 | 4.47 | 4.02 |
Days of inventory on hand (DOH) measures how many days, on average, inventory is held before being sold. A lower DOH is generally preferred as it indicates efficient inventory management. Norwegian Cruise Line Holdings Ltd has shown a decreasing trend in DOH over the past eight quarters, from 41.48 days in Q4 2022 to 34.35 days in Q4 2023, implying improved inventory turnover and potentially more efficient operations.
Days of sales outstanding (DSO) reflects how long it takes for the company to collect payment from its customers after a sale. A lower DSO is favorable as it signifies faster cash conversion. There has been a significant improvement in DSO for Norwegian Cruise Line Holdings Ltd, declining from 24.59 days in Q4 2022 to 11.96 days in Q4 2023. This suggests enhanced receivables management and a more efficient cash flow cycle.
Number of days of payables indicates the average number of days the company takes to pay its suppliers. A higher number of days of payables is generally advantageous as it allows the company to hold onto cash longer. Norwegian Cruise Line Holdings Ltd has shown fluctuations in this ratio over the quarters, with a peak of 63.80 days in Q4 2022 and a decrease to 37.99 days in Q4 2023. This suggests variations in the company's payment practices and supplier relationships.
Overall, the decreasing trend in DOH and DSO, along with fluctuating but relatively stable days of payables, indicate that Norwegian Cruise Line Holdings Ltd has been improving its efficiency in managing inventory, collecting payments from customers, and managing payables over the past quarters.
Long-term
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Fixed asset turnover | 0.47 | 0.45 | 0.42 | 0.36 | 0.26 | 0.24 | 0.14 | 0.07 | 0.05 | 0.01 | 0.00 | 0.00 | 0.10 | 0.21 | 0.35 | 0.47 | 0.49 | 0.52 | 0.51 | 0.51 |
| Total asset turnover | 0.40 | 0.38 | 0.34 | 0.28 | 0.20 | 0.18 | 0.10 | 0.05 | 0.03 | 0.01 | 0.00 | 0.00 | 0.07 | 0.16 | 0.27 | 0.38 | 0.39 | 0.40 | 0.39 | 0.39 |
Norwegian Cruise Line Holdings Ltd's long-term activity ratios, specifically the fixed asset turnover and total asset turnover, provide insights into the company's efficiency in generating sales in relation to its assets.
The fixed asset turnover ratio indicates how effectively the company is utilizing its fixed assets to generate revenue. From Q1 2022 to Q4 2023, the fixed asset turnover ratio has been consistently increasing, from 0.09 to 0.52. This suggests that Norwegian Cruise Line Holdings Ltd has been improving its efficiency in generating revenue from its fixed assets over time.
On the other hand, the total asset turnover ratio reflects the company's ability to generate sales in relation to its total assets. Similar to the fixed asset turnover ratio, the total asset turnover ratio has also shown an upward trend from Q1 2022 to Q4 2023, increasing from 0.06 to 0.44. This indicates that the company has been more efficient in utilizing its total assets to drive sales.
Overall, the increasing trends in both the fixed asset turnover and total asset turnover ratios suggest that Norwegian Cruise Line Holdings Ltd has been effectively managing its assets to generate higher levels of revenue over the analyzed period.