News Corp A (NWSA)

Short-term

Turnover ratios

The activity ratios of News Corp A over the analyzed period demonstrate notable fluctuations, reflecting changes in operational efficiency concerning inventory management, receivables collection, payables settlement, and working capital utilization.

Inventory Turnover:
The inventory turnover ratio exhibits significant volatility. Early in the period, it remains relatively high, with values around 25.80 (September 2020) and 25.08 (December 2020), indicating rapid inventory movement. The ratio declines gradually through 2021 and 2022, reaching lows such as 15.70 (September 2022) and 16.65 (March 2023). A marked decline is observed in 2025, particularly dropping to 7.99 (March 2025) and further down to 3.30 (June 2025), implying a slowdown in inventory turnover, potentially due to increased inventory levels or decreased sales velocity. The recent rebound to 19.59 (June 2024) and 13.39 (December 2024) suggests some recovery, yet the extremely low ratio of 7.99 remains below historical peaks, indicating an overall decline in inventory efficiency over the period.

Receivables Turnover:
Receivables turnover ratios indicate a relatively stable collection efficiency, oscillating between approximately 5.47 (September 2024) and 7.08 (September 2020). The highest value of 7.03 (September 2022) and the lowest of 5.47 (September 2024) point towards a moderate but declining trend in receivables collection efficiency over time. Despite fluctuations, the ratios stay within a narrow range, implying that the company's ability to collect receivables remains steady with slight deterioration.

Payables Turnover:
The payables turnover ratio demonstrates variability, with early values around 16.26 (September 2020) and peaks such as 24.01 (December 2023). Periods of lower ratios, such as 6.82 (March 2025), suggest longer durations to settle payables, indicating extended credit terms or delayed payments. The recent sharp decline to 3.22 (June 2025) highlights a trend toward significantly extended payables, possibly reflecting cash flow challenges or strategic credit extension policies.

Working Capital Turnover:
This metric reveals considerable fluctuations. Initially, the ratio remains above 10, reaching as high as 18.09 (June 2022), indicating efficient use of working capital during that period. However, from late 2022 onward, a declining trend emerges, with the ratio dropping below 10, reaching 3.41 (March 2025). The steep reduction signifies decreased efficiency in generating sales from working capital, potentially due to increased working capital levels, lower sales productivity, or operational challenges. The recent low ratios point toward a phase of diminished operational efficiency concerning working capital utilization.

Overall Summary:
Across the activity ratios, News Corp A exhibits signs of declining operational efficiency in inventory management, receivables collection, and working capital utilization over the analyzed timeframe. The sharp decrease in inventory turnover and working capital turnover ratios, coupled with extended payables periods, suggest the company may be experiencing strategic shifts, inventory build-up, or financial pressures impacting liquidity and operational performance. These trends warrant closer investigation into underlying operational and financial strategies, as well as market conditions influencing these activity metrics.

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Average number of days

The activity ratios for News Corp A over the analyzed period indicate evolving operational efficiency and working capital management.

Days of Inventory on Hand (DOH):
The DOH ratio demonstrates fluctuations with an overall increasing trend from approximately 14.15 days as of September 30, 2020 to a peak of 45.70 days on March 31, 2025. Initially, the ratio remained relatively stable around 14–20 days, reflecting prompt inventory turnover typical of Publishing and Digital media segments. However, from September 2022 onwards, there is a notable increase, culminating in a drastic rise to over 110 days by June 30, 2025. This suggests a significant accumulation of inventory or deferred inventory turnover, which could imply inventory buildup, changes in product mix, or decreased sales efficiency.

Days of Sales Outstanding (DSO):
The DSO metric presents an increasing trend over the period, rising from approximately 51.52 days in September 2020 to about 67.46 days in June 2025. This indicates a gradual extension in the average collection period, reflecting potentially more lenient credit terms or deterioration in receivables collection efficiency. Periods around 54–58 days are typical, but the observed rise to over 66 days suggests a trend toward increased receivables aging, which could impact cash flow and liquidity management.

Number of Days of Payables:
The accounts payable period exhibits variability but generally maintains a relatively short to moderate average. Initially, payables ranged from about 20 to 27.50 days, aligning with industry standards. However, there is a marked increase starting from December 31, 2023, when payables extend significantly to over 53 days by March 31, 2025. This lengthening indicates a possible strategic delay in payment to suppliers, potentially to conserve cash, or a shift in payment terms, which could strain supplier relationships or impact creditworthiness.

Summary of trends:
Overall, the activity ratios reveal increasing inventory levels and extended receivable and payable periods over time. The rising DOH could indicate inventory accumulation or waning sales velocity, while the lengthening DSO suggests collection challenges. The substantial increase in days of payables in late 2023 to mid-2025 points toward a shift towards more extended payment cycles. These combined tendencies may imply deteriorating operational efficiency or strategic adjustments in working capital management. Continuous monitoring is essential to understand whether these trends reflect operational challenges or deliberate financial strategies.

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Long-term

The analysis of News Corp A's long-term activity ratios reveals the following insights:

Fixed Asset Turnover:
The ratio exhibits notable fluctuations over the period. It ranged from a low of approximately 2.83 on June 30, 2021, to a high of approximately 5.26 on September 30, 2022. The period between September 2020 and March 2021 shows relatively stable values, with ratios in the range of approximately 3.77 to 3.95. A significant increase is observed starting in September 2021, reaching a peak in September 2022, suggesting an improvement in the efficiency with which fixed assets generate revenue. After that peak, the ratio declines slightly, indicating a potential reduction in fixed asset utilization efficiency or strategic adjustments in asset base or revenue generation.

Total Asset Turnover:
This ratio remains comparatively stable throughout the period, oscillating narrowly around 0.55 to 0.63. The highest value recorded is approximately 0.63 on September 30, 2022, whereas the lowest is around 0.55 on several dates, including June 30, 2022, and March 31, 2024. The slight variations reflect consistent utilization of total assets to generate sales, with no significant trend of deterioration or substantial improvement over the observed timeframe.

Overall, the ratios indicate that News Corp A has maintained a relatively steady level of operational efficiency concerning total asset utilization, with a period of notable improvement in fixed asset turnover around late 2021 to late 2022. This suggests that during this period, the company may have optimized or restructured its fixed assets to enhance revenue generation efficiency. The stability in total asset turnover implies consistent overall asset utilization efficiency across the organization, despite some fluctuations in fixed asset efficiency specific to investment in property, plant, or equipment.