Perrigo Company PLC (PRGO)

Short-term

Turnover ratios

Based on the provided data for Perrigo Company PLC, let's analyze the activity ratios:

1. Inventory Turnover: The inventory turnover ratio measures how efficiently a company manages its inventory. Perrigo's inventory turnover has been relatively stable over the years, around 2.6 to 2.7. This indicates that the company is selling through its inventory about 2.6 to 2.7 times a year, which is moderate efficiency in managing its inventory levels.

2. Receivables Turnover: Unfortunately, data is unavailable for Perrigo's receivables turnover, which measures how quickly the company collects on its credit sales. Without this information, it's challenging to assess how efficiently Perrigo is collecting its accounts receivable.

3. Payables Turnover: Similar to receivables turnover, data is also unavailable for Perrigo's payables turnover, which assesses how efficiently the company pays its suppliers. Without this data, it's hard to evaluate Perrigo's efficiency in managing its trade payables.

4. Working Capital Turnover: The working capital turnover ratio reflects how efficiently a company generates revenue from its working capital. Perrigo's working capital turnover has varied over the years, ranging from 1.82 to 3.73. A higher ratio signifies that the company is utilizing its working capital effectively to generate sales. In 2023, the ratio peaked at 3.73, suggesting a significant improvement in operational efficiency.

In conclusion, Perrigo Company PLC demonstrates reasonable inventory turnover and working capital turnover ratios, indicating efficient management of inventory and working capital to generate sales. However, without data on receivables and payables turnover, a comprehensive assessment of the company's overall efficiency in managing its assets and liabilities is limited.

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Average number of days

Perrigo Company PLC's activity ratios provide insight into how efficiently the company manages its operations.

1. Days of Inventory on Hand (DOH):
- The DOH measures how many days, on average, Perrigo holds its inventory before selling it.
- Over the period from December 31, 2020, to December 31, 2024, Perrigo's DOH has increased from 134.87 days to 139.49 days, indicating a lengthening of the inventory holding period.
- This suggests that Perrigo may be experiencing challenges in managing its inventory levels efficiently, which could lead to higher holding costs and potential obsolescence risks.

2. Days of Sales Outstanding (DSO):
- The DSO metric reflects the average number of days it takes for Perrigo to collect its accounts receivable.
- The data provided shows "— days" for all years, which indicates that specific DSO figures are not available for analysis.
- Without DSO figures, it is challenging to evaluate Perrigo's efficiency in collecting sales proceeds from customers.

3. Number of Days of Payables:
- This metric represents the average number of days Perrigo takes to pay its suppliers for goods or services received.
- Similar to DSO, the data provided shows "— days" for all years, indicating a lack of specific information on the payment period.
- Understanding the payment period is crucial as a longer payables period may suggest that Perrigo is effectively using suppliers' financing to manage its working capital.

In conclusion, while the analysis of Perrigo's DOH indicates a lengthening of the inventory holding period, the unavailability of DSO and payables data limits a comprehensive assessment of Perrigo's operational efficiency in managing receivables and payables. It would be beneficial to obtain more detailed information on these metrics to gain a more holistic view of the company's activity ratios.

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Long-term

Perrigo Company PLC's long-term activity ratios can be analyzed using the Fixed Asset Turnover and Total Asset Turnover ratios.

1. Fixed Asset Turnover:
- The Fixed Asset Turnover ratio measures how efficiently a company utilizes its fixed assets to generate sales. A higher ratio indicates efficient utilization of fixed assets.
- In 2020, the Fixed Asset Turnover was 5.08, showing that Perrigo generated $5.08 in sales for every dollar invested in fixed assets. This indicates high efficiency in asset utilization.
- The ratio decreased to 4.01 in 2021 and further declined to 3.82 in 2022. This downward trend suggests a decrease in the efficiency of utilizing fixed assets to generate sales.
- Unfortunately, data for 2023 and 2024 are not available (indicated by "—"), making it challenging to assess the trend accurately for these years.

2. Total Asset Turnover:
- The Total Asset Turnover ratio measures how efficiently a company utilizes its total assets to generate sales. A higher ratio indicates better efficiency in asset utilization.
- In 2020, Perrigo's Total Asset Turnover was 0.44, indicating that the company generated $0.44 in sales for every dollar of total assets. This suggests moderate efficiency in asset utilization.
- The ratio slightly decreased to 0.40 in both 2021 and 2022, indicating a slight decrease in efficiency in utilizing total assets to generate sales.
- However, in 2023 and 2024, the Total Asset Turnover ratio increased to 0.43 and 0.45, respectively. These increases suggest improved efficiency in utilizing total assets to generate sales in those years.

In conclusion, based on the available data, Perrigo Company PLC showed varying levels of efficiency in utilizing fixed and total assets to generate sales over the years. Further analysis with additional data for 2023 and 2024 would provide a more comprehensive understanding of the company's long-term activity ratios.