Procter & Gamble Company (PG)

Activity ratios

Short-term

Turnover ratios

	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	Dec 31, 2019	Sep 30, 2019
Inventory turnover	9.28	8.98	8.89	8.97	8.96	8.38	8.25	8.17	8.91	8.64	9.06	9.37	9.66	9.42	9.41	9.72	10.02	11.88	11.35	11.44
Receivables turnover	13.74	13.73	13.25	13.40	14.99	14.80	13.92	14.07	15.59	14.44	14.95	13.62	16.11	15.40	15.35	14.37	16.98	15.16	13.39	13.38
Payables turnover	4.24	4.64	4.47	4.42	4.34	4.55	4.40	4.18	4.15	4.33	4.27	4.16	4.21	4.66	4.66	4.65	4.56	6.05	5.81	5.71
Working capital turnover	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—

The activity ratios of Procter & Gamble Company show consistent performance and efficiency in managing its inventory, receivables, and payables.

1. Inventory turnover: Procter & Gamble's inventory turnover ratio has been relatively stable, ranging between 8.17 and 9.72 over the past two years. This indicates that the company is able to sell and replace its inventory efficiently, with the highest turnover occurring in September 2020.

2. Receivables turnover: The company's receivables turnover ratio has also remained steady, varying between 13.25 and 16.98. This demonstrates that Procter & Gamble is efficient in collecting payments from customers, with the highest turnover seen in December 2019.

3. Payables turnover: Procter & Gamble's payables turnover ratio has shown consistency, fluctuating between 4.15 and 6.05. This indicates that the company manages its trade payables effectively by settling its supplier invoices in a timely manner, with the lowest turnover observed in September 2019.

Overall, these activity ratios suggest that Procter & Gamble Company has maintained sound operational efficiency in managing its inventory, receivables, and payables over the analyzed period.

Average number of days

		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	Dec 31, 2019	Sep 30, 2019
Days of inventory on hand (DOH)	days	39.32	40.63	41.05	40.71	40.76	43.56	44.23	44.66	40.95	42.25	40.29	38.95	37.78	38.76	38.79	37.54	36.43	30.73	32.15	31.90
Days of sales outstanding (DSO)	days	26.57	26.59	27.54	27.24	24.35	24.66	26.22	25.95	23.41	25.27	24.42	26.79	22.66	23.70	23.78	25.40	21.49	24.08	27.25	27.29
Number of days of payables	days	86.10	78.61	81.71	82.56	84.12	80.27	83.00	87.35	88.01	84.33	85.46	87.84	86.63	78.37	78.32	78.50	79.98	60.33	62.78	63.93

Based on the activity ratios provided for Procter & Gamble Company, we can observe the following trends:

1. Days of Inventory on Hand (DOH):
- The company's DOH has fluctuated over the periods from a low of 30.73 days to a high of 44.66 days.
- Generally, the DOH has been maintained between 30 to 45 days, indicating the company manages its inventory efficiently without excessive stockpiling or shortages.
- A decreasing trend in DOH from December 2022 to September 2023 suggests improved inventory turnover efficiency during this period.

2. Days of Sales Outstanding (DSO):
- The DSO has varied between 21.49 days and 27.54 days during the periods analyzed.
- The company appears to collect its receivables within approximately 21 to 28 days on average, indicating effective management of accounts receivable.
- A lower DSO signifies that the company is efficient in collecting payments from customers, which can positively impact its cash flow and liquidity.

3. Number of Days of Payables:
- Procter & Gamble's payables period has been consistent, ranging from 60.33 days to 88.01 days.
- The company takes, on average, around 60 to 90 days to pay its suppliers, maintaining a balance between timely payments and extending payables to manage cash flow efficiently.
- An increasing trend in the payables period over consecutive periods might suggest a deliberate strategy to improve liquidity by lengthening the payment cycle.

In conclusion, Procter & Gamble demonstrates effective management of its inventory, receivables, and payables, maintaining a balance between these components to optimize working capital efficiency and overall liquidity. Monitoring these activity ratios can provide insights into the company's operational performance and financial health.

Long-term

	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	Dec 31, 2019	Sep 30, 2019
Fixed asset turnover	3.79	3.82	3.79	3.85	3.74	3.75	3.79	3.91	3.78	3.73	3.67	3.61	3.51	3.55	3.45	3.47	3.43	3.44	3.28	3.29
Total asset turnover	0.69	0.70	0.70	0.68	0.68	0.68	0.68	0.69	0.68	0.66	0.65	0.64	0.64	0.64	0.62	0.60	0.59	0.59	0.62	0.60

Procter & Gamble Company's fixed asset turnover ratio has been relatively stable over the past five quarters, ranging between 3.51 and 3.91. This indicates that the company generates approximately $3.51 to $3.91 in sales revenue for every dollar invested in fixed assets. The consistent performance in this ratio suggests that P&G efficiently utilizes its fixed assets to generate sales.

In contrast, the total asset turnover ratio has shown a slight improvement from 0.59 in Q3 2019 to 0.70 in Q1 2024, with some fluctuations in between. This ratio signifies that for every dollar of total assets, the company generates sales revenue between $0.59 and $0.70. The increasing trend in total asset turnover indicates that P&G is becoming more efficient in utilizing its total assets to generate revenue over time.

In conclusion, while P&G demonstrates stable efficiency in generating sales from fixed assets, the company has shown improvement in utilizing its total assets efficiently for revenue generation over the quarters. These long-term activity ratios collectively indicate that P&G is effectively managing its asset base to drive revenue growth and maximize profitability.