Viatris Inc (VTRS)

Short-term

Turnover ratios

Based on the data provided, let's analyze the activity ratios of Viatris Inc:

1. Inventory Turnover:
- The inventory turnover ratio indicates how efficiently a company is managing its inventory. A higher ratio signifies that inventory is being sold more quickly.
- Viatris Inc's inventory turnover has shown improvement over the years, increasing from 1.49 in 2020 to 2.37 in 2024. This indicates that the company is selling its inventory at a faster rate.

2. Receivables Turnover:
- Receivables turnover ratio measures how efficiently a company is collecting payments from its customers.
- The data provided shows that Viatris Inc's receivables turnover is not available for the years 2020-2024. This could be due to the nature of the company's industry or the way it manages its accounts receivable.

3. Payables Turnover:
- Payables turnover ratio indicates how quickly a company is paying its suppliers.
- Similar to receivables turnover, the data for payables turnover is not available for Viatris Inc for the years 2020-2024. This could be due to various reasons, such as the company's payment terms with suppliers or the industry norms.

4. Working Capital Turnover:
- The working capital turnover ratio measures how efficiently a company is utilizing its working capital to generate sales.
- Viatris Inc's working capital turnover varied significantly from 5.18 in 2020 to 17.56 in 2021, and then decreased to 3.94 in 2024. A higher ratio indicates that the company is generating more revenue per unit of working capital.

In summary, Viatris Inc has shown improvement in its inventory turnover and fluctuation in its working capital turnover over the years. However, the lack of data for receivables and payables turnover limits a comprehensive analysis of the company's overall efficiency in managing its working capital cycle. It would be beneficial to monitor these ratios in future periods to assess any changes in the company's operational efficiency.

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Average number of days

Viatris Inc's Days of Inventory on Hand (DOH) ratio has shown a downward trend over the years, indicating that the company is managing its inventory more efficiently. The DOH decreased from 245.08 days in 2020 to 154.32 days in 2024. This implies that Viatris is holding less inventory on hand, which could result in lower carrying costs and improved cash flow.

The Days of Sales Outstanding (DSO) and Number of Days of Payables ratios are not provided, suggesting that data for these activity ratios are unavailable or not applicable for Viatris Inc. However, these ratios are crucial for understanding the efficiency of the company's accounts receivable and accounts payable management, respectively.

In conclusion, based on the available data, Viatris Inc has improved its inventory management efficiency as reflected by the declining trend in the Days of Inventory on Hand ratio. Efficient inventory management is essential for optimizing working capital and maintaining a healthy cash flow position.

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Long-term

The fixed asset turnover ratio for Viatris Inc has shown an improvement over the years, increasing from 3.16 in 2020 to 5.14 in 2021, and then slightly decreasing to 4.95 in 2022. This indicates that the company is generating more revenue relative to its investment in fixed assets, reflecting greater efficiency in utilizing its long-term assets to generate sales.

On the other hand, the total asset turnover ratio for Viatris Inc has also been on an upward trend, rising from 0.19 in 2020 to 0.36 in 2024. This suggests that the company is generating more sales revenue for each dollar of total assets it holds, demonstrating improved efficiency in utilizing both short-term and long-term assets to generate sales.

Overall, the increasing trend in both the fixed asset turnover and total asset turnover ratios indicates that Viatris Inc is effectively utilizing its assets to drive sales growth and generate revenue, which is a positive sign for the company's long-term operational efficiency and financial performance.