Somnigroup International Inc. (SGI)

Short-term

Turnover ratios

Somnigroup International Inc.'s activity ratios provide insights into how efficiently the company manages its assets and liabilities to generate sales revenue.

1. Inventory Turnover:
- Somnigroup's inventory turnover has shown a slight decline from 6.53 in 2020 to 5.98 in 2021, further decreasing to 5.17 in 2022, then fluctuating to 5.79 in 2023 and finally increasing to 6.15 in 2024. This indicates that in recent years, the company took longer to sell its inventory, which could imply issues such as overstocking, slowing sales, or poor inventory management.

2. Receivables Turnover:
- The data for receivables turnover is not available, which makes it challenging to assess how quickly Somnigroup collects payments from its customers. A higher turnover ratio would indicate effective credit management and timely collections.

3. Payables Turnover:
- Similarly, information on payables turnover is not provided, preventing us from evaluating how quickly the company settles its accounts payable. A low turnover could suggest favorable credit terms with suppliers or inefficiencies in payment processes.

4. Working Capital Turnover:
- Somnigroup's working capital turnover has shown significant improvement over the years, surging from 22.19 in 2021 to 46.92 in 2024. This suggests that the company is utilizing its working capital more efficiently to generate sales revenue. A higher turnover ratio indicates that Somnigroup is effectively managing its current assets and liabilities in support of its operations.

In conclusion, while the inventory turnover has experienced fluctuations, indicating potential areas for improvement in inventory management, the notable increase in working capital turnover signals enhanced efficiency in utilizing resources to drive sales growth and operational performance. Monitoring and improving activity ratios can help Somnigroup optimize its asset utilization and overall financial performance.

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Average number of days

The days of inventory on hand (DOH) ratio provides insight into how efficiently Somnigroup International Inc. manages its inventory. An increase in the DOH ratio over time, from 55.88 days on December 31, 2020, to 59.31 days on December 31, 2024, suggests that the company is holding inventory for a longer period before selling it. This could indicate potential issues with inventory management, such as overstocking or slow-moving inventory.

On the other hand, the days of sales outstanding (DSO) ratio, which measures how long it takes for the company to collect its accounts receivable, is unavailable for analysis as the data is not provided for any of the years.

Lastly, the number of days of payables ratio, which evaluates how long it takes Somnigroup International Inc. to pay its suppliers, is also not available for analysis as the data is missing for all the years.

In summary, based on the available information, Somnigroup International Inc. appears to be facing challenges related to inventory management efficiency, given the increasing trend in the days of inventory on hand ratio over the years. However, without data on DSO and number of days of payables ratios, a comprehensive assessment of the company's overall activity ratios and working capital efficiency cannot be made.

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Long-term

Somnigroup International Inc.'s fixed asset turnover ratio remained constant at a value of "—", indicating that the company did not generate revenue efficiency from its fixed assets during the period covered by the data. In contrast, the total asset turnover ratio fluctuated over the years, starting at 1.11 in 2020 and peaking at 1.14 in 2021 before declining to 0.82 in 2024. This decline suggests that the company may not be effectively utilizing its total assets to generate sales revenue in the latter years of the period analyzed. Overall, the trend in the total asset turnover ratio implies a decrease in the efficiency of Somnigroup International Inc.'s asset utilization over the years, which may warrant further investigation to understand the underlying factors contributing to this decline.