Performance Food Group Co (PFGC)

Short-term

Turnover ratios

Performance Food Group Co's activity ratios indicate the efficiency with which the company manages its inventory, receivables, payables, and working capital over the past five years.

1. Inventory turnover:
- The inventory turnover ratio has been steadily increasing over the years, with a significant jump from 2019 to 2020 and further improvement in 2021 and 2023.
- This indicates that the company is selling its inventory more frequently and efficiently, which is a positive sign as higher turnover ratios imply better inventory management.

2. Receivables turnover:
- The receivables turnover ratio has also shown a consistent upward trend, indicating that the company is collecting its receivables more effectively over the years.
- The increasing turnover ratio suggests that Performance Food Group Co is able to convert its receivables into cash at a faster rate, improving its cash flow and liquidity position.

3. Payables turnover:
- The data provided does not include payables turnover for the latest years. However, in 2019 and 2020, the payables turnover ratio decreased, indicating a longer time taken by the company to pay its suppliers.
- A lower payables turnover ratio may suggest either extended credit terms with suppliers or potential cash flow issues. Without the most recent data, it is difficult to assess the current status.

4. Working capital turnover:
- The working capital turnover ratio has fluctuated over the years but generally shows an increasing trend, indicating that the company is generating more revenue relative to its working capital.
- A higher working capital turnover ratio suggests efficient utilization of working capital to generate sales, reflecting good operational efficiency.

In summary, Performance Food Group Co has demonstrated improvements in managing its inventory, receivables, and working capital turnover ratios over the years, reflecting efficient operations and liquidity management. However, the lack of payables turnover data for recent years limits a comprehensive analysis of the company's payables management.

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Average number of days

Performance Food Group Co's activity ratios show how efficiently the company manages its inventory, accounts receivable, and accounts payable.

1. Days of Inventory on Hand (DOH):
- In 2023, the company took approximately 24.05 days to sell its inventory, which is an improvement compared to the previous year.
- The decreasing trend in DOH indicates that Performance Food Group Co is managing its inventory more efficiently, potentially reducing carrying costs and minimizing the risk of obsolescence.

2. Days of Sales Outstanding (DSO):
- DSO measures how long it takes for the company to collect its accounts receivable.
- Performance Food Group Co improved its DSO from 16.85 days in 2022 to 15.62 days in 2023, reflecting a quicker collection of receivables.
- This efficiency in collecting payments may enhance the company's cash flow and working capital management.

3. Number of Days of Payables:
- Data is missing for the number of days of payables in 2023 and previous years. However, in 2021 and 2020, the company took 26.09 days and 23.58 days, respectively, to pay its suppliers.
- A longer payment period may indicate that Performance Food Group Co is effectively using trade credit terms to manage its cash flow and liquidity.

Overall, the improving trend in inventory turnover and collection of receivables, combined with potentially well-managed payables, suggests that Performance Food Group Co is optimizing its working capital cycle and enhancing its operational efficiency.

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Long-term

Performance Food Group Co's long-term activity ratios show how effectively the company is utilizing its assets to generate sales.

1. Fixed Asset Turnover:
- The fixed asset turnover ratio has been increasing steadily over the past five years, indicating that Performance Food Group Co has been more efficient in generating sales from its fixed assets.
- In 2023, the fixed asset turnover ratio reached a high of 25.19, which means that for every dollar invested in fixed assets, the company generated $25.19 in sales. This is a positive sign of asset productivity.

2. Total Asset Turnover:
- The total asset turnover ratio also demonstrates an improving trend over the years, suggesting that the company is becoming more efficient in generating sales from all its assets.
- In 2023, the total asset turnover ratio stood at 4.56, indicating that for every dollar of assets invested, the company generated $4.56 in sales. This indicates strong asset utilization.

Overall, both the fixed asset turnover and total asset turnover ratios of Performance Food Group Co have shown improvement over the years, reflecting the company's ability to efficiently utilize its assets to drive revenue growth. This is a positive sign for investors and indicates effective asset management by the company.