Warner Music Group (WMG)

Activity ratios

Short-term

Turnover ratios

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 Sep 30, 2019 Jun 30, 2019
Inventory turnover 57.21 51.27 41.97 45.24 45.25 49.94 48.19 55.34 53.61 58.67 47.39 56.25 59.61 66.62 59.39 80.66 66.40 64.06 55.66 60.40
Receivables turnover 5.19 5.12 5.27 5.29 5.71 5.79 6.11 6.02 6.27 5.96 6.31 6.04 6.03 5.14 5.79 6.09 5.91 5.13 5.77 5.90
Payables turnover 18.13 22.09 17.63 21.08 18.29 23.15 19.42 19.42 15.75 17.99 15.54 19.66 20.04 22.10 17.77 23.21 17.54 20.61 15.84 19.46
Working capital turnover — — — — — — — — — — — — — — — — — — — —

Warner Music Group's inventory turnover has shown fluctuations over the past two years, ranging from a low of 41.97 to a high of 80.66. This indicates the efficiency of the company in managing its inventory levels and converting them into sales. A higher inventory turnover ratio suggests better inventory management.

The receivables turnover ratio has also varied, with the lowest being 5.12 and the highest recorded at 6.31. This ratio reflects how quickly the company collects cash from its credit sales. A higher receivables turnover ratio indicates more efficient collection of accounts receivable.

On the other hand, the payables turnover ratio has demonstrated inconsistency, with values ranging from 15.54 to 23.21. This ratio reveals how quickly the company pays its suppliers. A higher payables turnover ratio may suggest a shorter time frame for paying off suppliers, which could potentially strain cash flow.

Unfortunately, the table indicates a lack of data for the working capital turnover ratio, preventing a comprehensive analysis of Warner Music Group's efficiency in managing its working capital.

Average number of days

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 Sep 30, 2019 Jun 30, 2019
Days of inventory on hand (DOH) days 6.38 7.12 8.70 8.07 8.07 7.31 7.57 6.60 6.81 6.22 7.70 6.49 6.12 5.48 6.15 4.53 5.50 5.70 6.56 6.04
Days of sales outstanding (DSO) days 70.28 71.32 69.21 68.98 63.98 63.00 59.69 60.65 58.18 61.25 57.86 60.41 60.54 71.04 63.06 59.89 61.76 71.10 63.21 61.86
Number of days of payables days 20.13 16.52 20.71 17.32 19.95 15.76 18.79 18.79 23.18 20.29 23.49 18.56 18.22 16.51 20.54 15.72 20.80 17.71 23.04 18.76

The Days of Inventory on Hand (DOH) for Warner Music Group fluctuated over the periods analyzed, ranging from a low of 4.53 days to a high of 8.70 days. This indicates the average number of days it takes for the company to sell its inventory. Generally, a lower DOH suggests efficient inventory management, with the company quickly turning over its stock.

The Days of Sales Outstanding (DSO) also varied, with values between 56.15 days to 71.32 days. DSO reflects the average number of days it takes for the company to collect revenue after making a sale. A lower DSO is desirable as it indicates quicker cash conversion.

The Number of Days of Payables shows how long Warner Music Group takes to pay its suppliers, with fluctuations from 15.72 days to 23.49 days. A higher number of days of payables suggests the company may be delaying payments to manage its cash flow effectively.

In summary, Warner Music Group has shown fluctuations in its activity ratios over the periods analyzed, but overall, the company has demonstrated efficient inventory management, reasonable collection of receivables, and varying but potentially strategic management of payables to optimize its cash flow position.

Long-term

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 Sep 30, 2019 Jun 30, 2019
Fixed asset turnover 13.46 13.12 12.90 12.97 13.19 13.53 14.50 14.49 14.85 14.84 14.54 14.52 13.93 13.60 13.48 14.39 15.34 15.35 14.92 14.83
Total asset turnover 0.71 0.68 0.69 0.72 0.72 0.72 0.77 0.76 0.74 0.70 0.73 0.72 0.69 0.65 0.70 0.73 0.74 0.72 0.74 0.74

Warner Music Group's long-term activity ratios, specifically the fixed asset turnover and total asset turnover, show the efficiency with which the company utilizes its assets to generate sales.

The fixed asset turnover has remained relatively stable over the periods, ranging from 12.90 to 15.35, indicating that Warner Music Group efficiently generates revenue from its fixed assets. A higher fixed asset turnover ratio generally indicates better utilization of fixed assets to generate sales.

On the other hand, the total asset turnover ratio fluctuated but generally stayed within the range of 0.65 to 0.77. This indicates that for every dollar invested in total assets, Warner Music Group generated sales revenue between 0.65 and 0.77. A higher total asset turnover ratio typically suggests better efficiency in utilizing both fixed and current assets to generate sales.

Overall, the company's asset turnover ratios reflect a consistent and efficient use of assets to generate revenue over the periods analyzed. It's essential for Warner Music Group to continue monitoring these ratios to ensure optimal asset utilization and sustained profitability.