STERIS plc (STE)
Activity ratios
Short-term
Turnover ratios
| Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Inventory turnover | 5.14 | 4.60 | 4.30 | 4.24 | 4.40 | 3.50 | 3.59 | 3.73 | 4.02 | 3.80 | 4.06 | 4.30 | 4.47 | 4.08 | 3.92 | 3.25 | 5.61 | 5.89 | 6.14 | 6.15 |
| Receivables turnover | 5.23 | 5.90 | 5.87 | 6.09 | 5.40 | 5.61 | 5.56 | 5.73 | 5.34 | 5.81 | 6.12 | 6.25 | 5.74 | 5.65 | 5.05 | 4.58 | 5.10 | 5.50 | 6.00 | 5.97 |
| Payables turnover | 10.63 | 12.53 | 12.61 | 12.78 | 11.78 | 10.82 | 10.05 | 11.01 | 10.01 | 10.89 | 11.22 | 11.64 | 11.38 | 11.70 | 10.10 | 8.29 | 11.25 | 12.88 | 13.70 | 12.76 |
| Working capital turnover | 5.58 | 5.36 | 4.79 | 4.92 | 2.81 | 4.14 | 4.02 | 4.44 | 4.31 | 4.05 | 4.70 | 5.08 | 4.79 | 4.15 | 3.44 | 3.95 | 4.90 | 4.56 | 4.23 | 4.86 |
STERIS plc's activity ratios provide insights into how efficiently the company is managing its assets and resources. Let's analyze the key activity ratios over the reporting periods:
1. Inventory Turnover: The inventory turnover ratio measures how many times inventory is sold and replaced over a period. STERIS plc's inventory turnover has generally been declining, indicating a decrease in the efficiency of inventory management from 6.15 in June 2020 to 5.14 in March 2025. There was a noticeable drop between June 2021 and March 2024, but a slight improvement in the later periods.
2. Receivables Turnover: The receivables turnover ratio reflects how quickly the company collects outstanding payments from customers. STERIS plc's receivables turnover remained relatively stable over the periods, fluctuating within a narrow range between 4.58 and 6.25. This suggests consistent and effective credit management practices.
3. Payables Turnover: The payables turnover ratio measures how quickly the company pays its suppliers. STERIS plc's payables turnover ratio declined from 12.76 in June 2020 to 10.63 in March 2025. A decreasing trend indicates a longer time taken to pay off trade payables, which could be a negotiation tactic with suppliers or a potential strain on the liquidity position.
4. Working Capital Turnover: The working capital turnover ratio evaluates how efficiently working capital is used to generate sales. STERIS plc's working capital turnover fluctuated over the periods, with a notable decrease from 4.86 in June 2020 to 2.81 in March 2024, followed by an increase to 5.58 in March 2025. A higher ratio implies better utilization of working capital to generate revenue.
In conclusion, while the receivables turnover and working capital turnover ratios remained relatively steady, STERIS plc experienced fluctuations in its inventory turnover and payables turnover ratios. These variations should be carefully monitored to ensure efficient management of assets, effective credit policies, and healthy supplier relationships.
Average number of days
| Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 71.07 | 79.40 | 84.86 | 86.08 | 83.00 | 104.30 | 101.56 | 97.76 | 90.72 | 95.98 | 89.96 | 84.96 | 81.70 | 89.56 | 93.00 | 112.45 | 65.11 | 62.00 | 59.42 | 59.35 |
| Days of sales outstanding (DSO) | days | 69.79 | 61.88 | 62.14 | 59.92 | 67.63 | 65.07 | 65.65 | 63.71 | 68.34 | 62.78 | 59.61 | 58.41 | 63.61 | 64.63 | 72.28 | 79.64 | 71.58 | 66.40 | 60.83 | 61.16 |
| Number of days of payables | days | 34.33 | 29.13 | 28.95 | 28.55 | 30.97 | 33.73 | 36.32 | 33.15 | 36.47 | 33.52 | 32.54 | 31.36 | 32.08 | 31.20 | 36.12 | 44.02 | 32.43 | 28.35 | 26.65 | 28.61 |
The activity ratios for STERIS plc provide insight into how efficiently the company manages its working capital. The days of inventory on hand (DOH) measure how many days it takes for the company to sell its inventory. From June 2020 to March 2025, the DOH increased, indicating a longer time to sell inventory, potentially tying up more capital in unsold goods.
The days of sales outstanding (DSO) represent how long it takes for the company to collect payment from its customers. The DSO fluctuated during the period, with some increases and decreases. Lower DSO values suggest quicker collection of receivables, while higher values indicate a longer collection period.
The number of days of payables measures how long it takes the company to pay its suppliers. STERIS plc managed to keep a relatively stable number of days of payables over the period, with slight fluctuations. A longer period signifies that the company is taking more time to pay its suppliers, potentially preserving cash flow.
Overall, the trends in these activity ratios suggest that STERIS plc has been facing challenges in inventory management and collection of receivables, while maintaining a consistent approach to managing payables during the period from June 2020 to March 2025.
Long-term
| Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Fixed asset turnover | — | — | — | — | — | — | 2.70 | 2.65 | 2.91 | 2.86 | 3.04 | 2.72 | 2.63 | 2.48 | 2.25 | 2.00 | 2.52 | 2.49 | 2.57 | 2.33 |
| Total asset turnover | 0.54 | 0.54 | 0.53 | 0.54 | 0.49 | 0.47 | 0.46 | 0.47 | 0.46 | 0.44 | 0.46 | 0.43 | 0.40 | 0.36 | 0.33 | 0.28 | 0.47 | 0.46 | 0.55 | 0.56 |
The fixed asset turnover ratio for STERIS plc has shown a fluctuating trend over the years, ranging from 2.00 to 3.04. This ratio indicates how efficiently the company generates revenue from its fixed assets. The increasing trend from June 2022 to September 2022 suggests that the company was able to generate more revenue per fixed asset during that period.
On the other hand, the total asset turnover ratio ranged from 0.28 to 0.54, indicating how effectively the company is utilizing all its assets to generate sales. The ratio has generally improved from June 2021 to March 2025, indicating an increase in revenue generated for each dollar of assets owned by the company.
Overall, while the fixed asset turnover ratio shows some volatility, the total asset turnover ratio depicts a more consistent improvement over time, suggesting that STERIS plc has become more efficient in generating revenue from its total assets.