Tidewater Inc (TDW)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Inventory turnover | 26.20 | 20.33 | 36.72 | 34.01 | 21.95 |
| Receivables turnover | 290.25 | — | — | 5.34 | 3.75 |
| Payables turnover | 18.62 | 16.10 | 22.27 | 31.80 | 17.44 |
| Working capital turnover | 3.69 | 3.43 | 1.85 | 1.83 | 1.38 |
Tidewater Inc's activity ratios indicate the efficiency of its operational processes. The inventory turnover has shown fluctuations over the past five years, demonstrating the number of times inventory is sold and replaced during the year. The company's inventory turnover has generally been high, with a notable peak in 2021 and a consistent level in recent years.
The receivables turnover ratio signifies the ability of Tidewater Inc to collect outstanding receivables. The substantial increase in 2023 implies a significant improvement in collecting receivables compared to the previous year. However, data for 2022 and prior years is not available for comparison.
The payables turnover ratio suggests how efficiently the company pays its suppliers. Tidewater Inc has maintained a relatively stable payables turnover ratio over the past five years, with fluctuations observed. The decrease in 2022 indicates a potential extension of payment terms or improved cash flows.
The working capital turnover ratio reflects how well the company generates revenue relative to its working capital. Tidewater Inc has shown consistent growth in this ratio over the years, indicating an improvement in generating revenue from its working capital. The ratio has increased steadily, implying a more efficient utilization of working capital in generating sales.
Overall, Tidewater Inc's activity ratios indicate sound operational efficiency with improvements in inventory turnover, receivables collection, and working capital utilization. However, monitoring payables turnover and ensuring a balance between collecting receivables and managing payables will be essential for sustained operational efficiency.
Average number of days
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 13.93 | 17.95 | 9.94 | 10.73 | 16.63 |
| Days of sales outstanding (DSO) | days | 1.26 | — | — | 68.41 | 97.30 |
| Number of days of payables | days | 19.61 | 22.68 | 16.39 | 11.48 | 20.93 |
To evaluate Tidewater Inc's efficiency in managing its inventory, collecting receivables, and paying its payables, we can assess the activity ratios.
1. Days of Inventory on Hand (DOH):
- The trend in DOH shows fluctuations over the past five years, ranging from 9.94 days in 2021 to 17.95 days in 2022.
- In 2023, Tidewater Inc improved its inventory management with the DOH decreasing to 13.93 days, indicating a more efficient utilization of inventory.
- A lower DOH is generally desirable as it suggests faster inventory turnover and potentially lower carrying costs.
2. Days of Sales Outstanding (DSO):
- DSO indicates how long it takes for the company to collect its accounts receivable.
- The data for 2022 and 2021 is missing, making it challenging to analyze the trend effectively.
- A lower DSO is preferable as it signifies quicker collection of receivables, improving the company's cash flow.
3. Number of Days of Payables:
- Tidewater Inc's days of payables show variations from 11.48 days in 2020 to 22.68 days in 2022.
- In 2023, the days of payables decreased to 19.61 days, suggesting the company is taking longer to settle its payables compared to the preceding year.
- A higher number of days of payables may indicate a more extended period to pay suppliers, potentially improving cash flows but could strain supplier relationships.
Overall, Tidewater Inc's activity ratios reflect improvements in inventory management efficiency, while the clarity regarding receivables and payables management is limited due to missing data. Continued monitoring and analysis of these ratios will provide insights into the company's operational performance and effectiveness in managing its working capital.
Long-term
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 0.74 | 0.79 | 0.50 | 0.48 | 0.62 |
| Total asset turnover | 0.47 | 0.48 | 0.31 | 0.30 | 0.31 |
Tidewater Inc's fixed asset turnover ratio has shown a decreasing trend over the past five years, indicating that the company is generating less revenue from its fixed assets. This could be a cause for concern as it may suggest inefficiency in utilizing its long-term assets to generate sales.
On the other hand, the total asset turnover ratio has also decreased over the same period, indicating that the company is generating less revenue relative to its total assets. This may imply that Tidewater Inc is not effectively utilizing all its assets to generate sales, potentially pointing to operational inefficiencies or a decrease in overall business activity.
Overall, the decreasing trend in both fixed asset turnover and total asset turnover ratios for Tidewater Inc over the past five years suggests a potential decline in operational efficiency and effectiveness in utilizing its long-term assets to generate revenue. Management may need to assess their asset utilization strategies and consider implementing measures to improve efficiency and maximize returns on their assets.