Valvoline Inc (VVV)

Activity ratios

Short-term

Turnover ratios

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 Mar 31, 2020 Dec 31, 2019
Inventory turnover 34.03 31.73 32.95 38.14 35.09 -11.98 3.16 18.77 36.29 9.79 10.29 10.02 88.07 7.02 6.91 6.55 6.87 6.99 6.77 7.49
Receivables turnover 19.20 16.11 13.92 17.74 17.72 19.32 32.24 44.13 45.94 5.14 5.03 4.99 37.38 5.71 5.63 5.58 5.44 5.89 6.90 6.18
Payables turnover 11.51 11.84 10.40 15.56 9.84 -4.24 1.23 12.57 23.71 11.30 11.94 12.14 62.51 8.03 8.37 8.84 7.24 7.42 7.60 9.50
Working capital turnover — — — 3.77 2.51 2.04 1.07 3.23 4.33 7.31 6.57 5.75 5.21 5.50 4.85 3.39 2.37 2.46 2.47 6.54

Valvoline Inc's activity ratios provide insight into how efficiently the company manages its operations and resources.

1. Inventory turnover: This ratio indicates how many times inventory is sold and replaced over a period. Valvoline's inventory turnover has been relatively stable over the periods, ranging from 31.73 to 38.14. A higher turnover is generally favorable as it signifies efficient inventory management.

2. Receivables turnover: This ratio reflects how quickly the company collects payments from customers. Valvoline's receivables turnover has varied, with a range of 13.92 to 45.94 over the periods. A higher turnover suggests effective credit policies and collection efforts.

3. Payables turnover: This ratio measures how quickly the company pays its suppliers. Valvoline's payables turnover has fluctuated, ranging from 9.84 to 23.71. A higher turnover may indicate good relationships with suppliers and effective cash management.

4. Working capital turnover: This ratio evaluates how efficiently the company utilizes its working capital to generate sales. Valvoline's working capital turnover has varied, with a range of 1.07 to 7.31. A higher turnover indicates effective use of working capital to support revenue generation.

Overall, Valvoline's activity ratios suggest a mix of efficient management of inventory, receivables, and payables, but the working capital turnover shows some fluctuation in the company's ability to convert working capital into sales consistently. Monitoring these ratios over time can help identify trends and areas for improvement in operational efficiency.

Average number of days

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 Mar 31, 2020 Dec 31, 2019
Days of inventory on hand (DOH) days 10.72 11.50 11.08 9.57 10.40 — 115.68 19.44 10.06 37.29 35.46 36.42 4.14 51.99 52.84 55.69 53.10 52.22 53.95 48.73
Days of sales outstanding (DSO) days 19.01 22.65 26.22 20.57 20.59 18.90 11.32 8.27 7.95 71.02 72.58 73.10 9.76 63.92 64.84 65.40 67.14 62.01 52.92 59.09
Number of days of payables days 31.72 30.82 35.09 23.46 37.08 — 296.28 29.04 15.39 32.30 30.58 30.07 5.84 45.47 43.63 41.31 50.43 49.18 48.01 38.43

Days of inventory on hand (DOH) measures how efficiently a company manages its inventory. A lower number indicates inventory is moving faster. Valvoline Inc's DOH has been relatively consistent, ranging from 9.57 to 11.50 days over the recent quarters.

Days of sales outstanding (DSO) reflects the average number of days it takes for a company to collect revenue once a sale is made. Lower DSO values are preferable, as they indicate quicker cash conversion. Valvoline Inc's DSO has varied, with a recent low of 7.95 days but has also reached as high as 73.10 days in past quarters.

Number of days of payables measures how long it takes a company to pay its bills to suppliers. A higher number indicates the company is taking longer to pay its suppliers. Valvoline Inc's payables days have fluctuated, with values ranging from 15.39 to 296.28 days over the periods provided.

Overall, Valvoline Inc appears to have a relatively efficient management of inventory, collection of revenue, and payment of bills. However, the company should monitor fluctuations in these activity ratios to ensure optimal liquidity and working capital management.

Long-term

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 Mar 31, 2020 Dec 31, 2019
Fixed asset turnover 1.40 1.69 1.74 1.76 1.76 1.82 2.73 3.62 4.54 3.43 3.36 3.21 2.99 3.62 3.40 3.37 3.84 4.17 4.77 5.09
Total asset turnover 0.68 0.66 0.55 0.55 0.50 0.47 0.46 0.71 0.89 0.89 0.87 0.83 0.77 0.92 0.86 0.76 0.77 0.79 0.83 1.06

Valvoline Inc's long-term activity ratios, specifically the fixed asset turnover and total asset turnover, provide insight into how efficiently the company is utilizing its assets to generate sales revenue.

The fixed asset turnover ratio has shown a decreasing trend from 2019 to 2024, indicating that Valvoline is becoming less efficient in generating sales revenue from its fixed assets over time. However, it is important to note that the ratio has fluctuated over the years, possibly due to changes in the company's capital expenditures or business operations.

On the other hand, the total asset turnover ratio has also fluctuated but has generally remained relatively stable over the years. This ratio measures the overall efficiency of Valvoline in generating sales from all its assets, including fixed and current assets. A lower total asset turnover could suggest that the company is not efficiently utilizing its total assets to generate sales.

In conclusion, Valvoline Inc's long-term activity ratios indicate varying levels of efficiency in utilizing its assets to generate sales revenue. Monitoring these ratios over time can help assess the company's operational efficiency and identify areas for improvement.