Analysis of Short-term (Operating) Activity Ratios
Activity ratios measure how efficiently a company performs day-to-day tasks, such us the collection of receivables and management of inventory.
Short-term Activity Ratios (Summary)
Allergan Inc., short-term (operating) activity ratios
Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).
| Short-term activity ratio | Description | The company |
|---|---|---|
| Inventory turnover | An activity ratio calculated as cost of goods sold divided by inventory. | Allergan Inc. inventory turnover ratio improved from 2012 to 2013 and from 2013 to 2014. |
| Receivables turnover | An activity ratio equal to revenue divided by receivables. | Allergan Inc. receivables turnover ratio deteriorated from 2012 to 2013 but then improved from 2013 to 2014 exceeding 2012 level. |
| Payables turnover | An activity ratio calculated as cost of goods sold divided by payables. | Allergan Inc. payables turnover ratio decreased from 2012 to 2013 but then slightly increased from 2013 to 2014. |
| Working capital turnover | An activity ratio calculated as revenue divided by working capital. | Allergan Inc. working capital turnover ratio deteriorated from 2012 to 2013 and from 2013 to 2014. |
| Short-term activity ratio | Description | The company |
|---|---|---|
| Average inventory processing period | An activity ratio equal to the number of days in the period divided by inventory turnover over the period. | Allergan Inc. number of days of inventory outstanding improved from 2012 to 2013 and from 2013 to 2014. |
| Average receivable collection period | An activity ratio equal to the number of days in the period divided by receivables turnover. | Allergan Inc. number of days of receivables outstanding deteriorated from 2012 to 2013 but then improved from 2013 to 2014 exceeding 2012 level. |
| Operating cycle | Equal to average inventory processing period plus average receivables collection period. | Allergan Inc. operating cycle deteriorated from 2012 to 2013 but then improved from 2013 to 2014 exceeding 2012 level. |
| Average payables payment period | An estimate of the average number of days it takes a company to pay its suppliers; equal to the number of days in the period divided by payables turnover ratio for the period. | Allergan Inc. number of days of payables outstanding increased from 2012 to 2013 but then slightly decreased from 2013 to 2014. |
| Cash conversion cycle | A financial metric that measures the length of time required for a company to convert cash invested in its operations to cash received as a result of its operations; equal to average inventory processing period plus average receivables collection period minus average payables payment period. | Allergan Inc. cash conversion cycle improved from 2012 to 2013 and from 2013 to 2014. |
Inventory Turnover
Allergan Inc., inventory turnover calculation, comparison to benchmarks
| Dec 31, 2014 | Dec 31, 2013 | Dec 31, 2012 | Dec 31, 2011 | Dec 31, 2010 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Cost of sales, excludes amortization of intangible assets | 842,400) | 795,800) | 775,500) | 748,700) | 722,000) | |
| Inventories | 296,000) | 285,300) | 282,900) | 249,700) | 229,400) | |
| Short-term Activity Ratio | ||||||
| Inventory turnover1 | 2.85 | 2.79 | 2.74 | 3.00 | 3.15 | |
| Benchmarks | ||||||
| Inventory Turnover, Competitors2 | ||||||
| AbbVie Inc. | — | — | — | — | — | |
| Amgen Inc. | — | — | — | — | — | |
| Bristol-Myers Squibb Co. | — | — | — | — | — | |
| Danaher Corp. | — | — | — | — | — | |
| Eli Lilly & Co. | — | — | — | — | — | |
| Gilead Sciences Inc. | — | — | — | — | — | |
| Johnson & Johnson | — | — | — | — | — | |
| Merck & Co. Inc. | — | — | — | — | — | |
| Pfizer Inc. | — | — | — | — | — | |
| Regeneron Pharmaceuticals Inc. | — | — | — | — | — | |
| Thermo Fisher Scientific Inc. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).
1 2014 Calculation
Inventory turnover = Cost of sales, excludes amortization of intangible assets ÷ Inventories
= 842,400 ÷ 296,000 = 2.85
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Inventory turnover | An activity ratio calculated as cost of goods sold divided by inventory. | Allergan Inc. inventory turnover ratio improved from 2012 to 2013 and from 2013 to 2014. |
Receivables Turnover
Allergan Inc., receivables turnover calculation, comparison to benchmarks
| Dec 31, 2014 | Dec 31, 2013 | Dec 31, 2012 | Dec 31, 2011 | Dec 31, 2010 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Product net sales | 7,126,100) | 6,197,500) | 5,708,800) | 5,347,100) | 4,819,600) | |
| Trade receivables, net | 914,500) | 883,300) | 764,200) | 730,600) | 647,300) | |
| Short-term Activity Ratio | ||||||
| Receivables turnover1 | 7.79 | 7.02 | 7.47 | 7.32 | 7.45 | |
| Benchmarks | ||||||
| Receivables Turnover, Competitors2 | ||||||
| AbbVie Inc. | — | — | — | — | — | |
| Amgen Inc. | — | — | — | — | — | |
| Bristol-Myers Squibb Co. | — | — | — | — | — | |
| Danaher Corp. | — | — | — | — | — | |
| Eli Lilly & Co. | — | — | — | — | — | |
| Gilead Sciences Inc. | — | — | — | — | — | |
| Johnson & Johnson | — | — | — | — | — | |
| Merck & Co. Inc. | — | — | — | — | — | |
| Pfizer Inc. | — | — | — | — | — | |
| Regeneron Pharmaceuticals Inc. | — | — | — | — | — | |
| Thermo Fisher Scientific Inc. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).
1 2014 Calculation
Receivables turnover = Product net sales ÷ Trade receivables, net
= 7,126,100 ÷ 914,500 = 7.79
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Receivables turnover | An activity ratio equal to revenue divided by receivables. | Allergan Inc. receivables turnover ratio deteriorated from 2012 to 2013 but then improved from 2013 to 2014 exceeding 2012 level. |
Payables Turnover
Allergan Inc., payables turnover calculation, comparison to benchmarks
| Dec 31, 2014 | Dec 31, 2013 | Dec 31, 2012 | Dec 31, 2011 | Dec 31, 2010 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Cost of sales, excludes amortization of intangible assets | 842,400) | 795,800) | 775,500) | 748,700) | 722,000) | |
| Accounts payable | 287,400) | 283,200) | 233,100) | 200,400) | 222,500) | |
| Short-term Activity Ratio | ||||||
| Payables turnover1 | 2.93 | 2.81 | 3.33 | 3.74 | 3.24 | |
| Benchmarks | ||||||
| Payables Turnover, Competitors2 | ||||||
| AbbVie Inc. | — | — | — | — | — | |
| Amgen Inc. | — | — | — | — | — | |
| Bristol-Myers Squibb Co. | — | — | — | — | — | |
| Danaher Corp. | — | — | — | — | — | |
| Eli Lilly & Co. | — | — | — | — | — | |
| Gilead Sciences Inc. | — | — | — | — | — | |
| Johnson & Johnson | — | — | — | — | — | |
| Merck & Co. Inc. | — | — | — | — | — | |
| Pfizer Inc. | — | — | — | — | — | |
| Regeneron Pharmaceuticals Inc. | — | — | — | — | — | |
| Thermo Fisher Scientific Inc. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).
1 2014 Calculation
Payables turnover = Cost of sales, excludes amortization of intangible assets ÷ Accounts payable
= 842,400 ÷ 287,400 = 2.93
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Payables turnover | An activity ratio calculated as cost of goods sold divided by payables. | Allergan Inc. payables turnover ratio decreased from 2012 to 2013 but then slightly increased from 2013 to 2014. |
Working Capital Turnover
Allergan Inc., working capital turnover calculation, comparison to benchmarks
| Dec 31, 2014 | Dec 31, 2013 | Dec 31, 2012 | Dec 31, 2011 | Dec 31, 2010 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Current assets | 6,871,200) | 5,319,700) | 4,458,800) | 4,048,300) | 3,993,700) | |
| Less: Current liabilities | 1,557,300) | 1,244,300) | 1,095,200) | 955,000) | 1,528,400) | |
| Working capital | 5,313,900) | 4,075,400) | 3,363,600) | 3,093,300) | 2,465,300) | |
| Product net sales | 7,126,100) | 6,197,500) | 5,708,800) | 5,347,100) | 4,819,600) | |
| Short-term Activity Ratio | ||||||
| Working capital turnover1 | 1.34 | 1.52 | 1.70 | 1.73 | 1.95 | |
| Benchmarks | ||||||
| Working Capital Turnover, Competitors2 | ||||||
| AbbVie Inc. | — | — | — | — | — | |
| Amgen Inc. | — | — | — | — | — | |
| Bristol-Myers Squibb Co. | — | — | — | — | — | |
| Danaher Corp. | — | — | — | — | — | |
| Eli Lilly & Co. | — | — | — | — | — | |
| Gilead Sciences Inc. | — | — | — | — | — | |
| Johnson & Johnson | — | — | — | — | — | |
| Merck & Co. Inc. | — | — | — | — | — | |
| Pfizer Inc. | — | — | — | — | — | |
| Regeneron Pharmaceuticals Inc. | — | — | — | — | — | |
| Thermo Fisher Scientific Inc. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).
1 2014 Calculation
Working capital turnover = Product net sales ÷ Working capital
= 7,126,100 ÷ 5,313,900 = 1.34
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Working capital turnover | An activity ratio calculated as revenue divided by working capital. | Allergan Inc. working capital turnover ratio deteriorated from 2012 to 2013 and from 2013 to 2014. |
Average Inventory Processing Period
Allergan Inc., average inventory processing period calculation, comparison to benchmarks
| Dec 31, 2014 | Dec 31, 2013 | Dec 31, 2012 | Dec 31, 2011 | Dec 31, 2010 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Inventory turnover | 2.85 | 2.79 | 2.74 | 3.00 | 3.15 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average inventory processing period1 | 128 | 131 | 133 | 122 | 116 | |
| Benchmarks (no. days) | ||||||
| Average Inventory Processing Period, Competitors2 | ||||||
| AbbVie Inc. | — | — | — | — | — | |
| Amgen Inc. | — | — | — | — | — | |
| Bristol-Myers Squibb Co. | — | — | — | — | — | |
| Danaher Corp. | — | — | — | — | — | |
| Eli Lilly & Co. | — | — | — | — | — | |
| Gilead Sciences Inc. | — | — | — | — | — | |
| Johnson & Johnson | — | — | — | — | — | |
| Merck & Co. Inc. | — | — | — | — | — | |
| Pfizer Inc. | — | — | — | — | — | |
| Regeneron Pharmaceuticals Inc. | — | — | — | — | — | |
| Thermo Fisher Scientific Inc. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).
1 2014 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 2.85 = 128
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Average inventory processing period | An activity ratio equal to the number of days in the period divided by inventory turnover over the period. | Allergan Inc. number of days of inventory outstanding improved from 2012 to 2013 and from 2013 to 2014. |
Average Receivable Collection Period
Allergan Inc., average receivable collection period calculation, comparison to benchmarks
| Dec 31, 2014 | Dec 31, 2013 | Dec 31, 2012 | Dec 31, 2011 | Dec 31, 2010 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Receivables turnover | 7.79 | 7.02 | 7.47 | 7.32 | 7.45 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average receivable collection period1 | 47 | 52 | 49 | 50 | 49 | |
| Benchmarks (no. days) | ||||||
| Average Receivable Collection Period, Competitors2 | ||||||
| AbbVie Inc. | — | — | — | — | — | |
| Amgen Inc. | — | — | — | — | — | |
| Bristol-Myers Squibb Co. | — | — | — | — | — | |
| Danaher Corp. | — | — | — | — | — | |
| Eli Lilly & Co. | — | — | — | — | — | |
| Gilead Sciences Inc. | — | — | — | — | — | |
| Johnson & Johnson | — | — | — | — | — | |
| Merck & Co. Inc. | — | — | — | — | — | |
| Pfizer Inc. | — | — | — | — | — | |
| Regeneron Pharmaceuticals Inc. | — | — | — | — | — | |
| Thermo Fisher Scientific Inc. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).
1 2014 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 7.79 = 47
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Average receivable collection period | An activity ratio equal to the number of days in the period divided by receivables turnover. | Allergan Inc. number of days of receivables outstanding deteriorated from 2012 to 2013 but then improved from 2013 to 2014 exceeding 2012 level. |
Operating Cycle
Allergan Inc., operating cycle calculation, comparison to benchmarks
No. days
| Dec 31, 2014 | Dec 31, 2013 | Dec 31, 2012 | Dec 31, 2011 | Dec 31, 2010 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Average inventory processing period | 128 | 131 | 133 | 122 | 116 | |
| Average receivable collection period | 47 | 52 | 49 | 50 | 49 | |
| Short-term Activity Ratio | ||||||
| Operating cycle1 | 175 | 183 | 182 | 172 | 165 | |
| Benchmarks | ||||||
| Operating Cycle, Competitors2 | ||||||
| AbbVie Inc. | — | — | — | — | — | |
| Amgen Inc. | — | — | — | — | — | |
| Bristol-Myers Squibb Co. | — | — | — | — | — | |
| Danaher Corp. | — | — | — | — | — | |
| Eli Lilly & Co. | — | — | — | — | — | |
| Gilead Sciences Inc. | — | — | — | — | — | |
| Johnson & Johnson | — | — | — | — | — | |
| Merck & Co. Inc. | — | — | — | — | — | |
| Pfizer Inc. | — | — | — | — | — | |
| Regeneron Pharmaceuticals Inc. | — | — | — | — | — | |
| Thermo Fisher Scientific Inc. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).
1 2014 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= 128 + 47 = 175
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Operating cycle | Equal to average inventory processing period plus average receivables collection period. | Allergan Inc. operating cycle deteriorated from 2012 to 2013 but then improved from 2013 to 2014 exceeding 2012 level. |
Average Payables Payment Period
Allergan Inc., average payables payment period calculation, comparison to benchmarks
| Dec 31, 2014 | Dec 31, 2013 | Dec 31, 2012 | Dec 31, 2011 | Dec 31, 2010 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Payables turnover | 2.93 | 2.81 | 3.33 | 3.74 | 3.24 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average payables payment period1 | 125 | 130 | 110 | 98 | 112 | |
| Benchmarks (no. days) | ||||||
| Average Payables Payment Period, Competitors2 | ||||||
| AbbVie Inc. | — | — | — | — | — | |
| Amgen Inc. | — | — | — | — | — | |
| Bristol-Myers Squibb Co. | — | — | — | — | — | |
| Danaher Corp. | — | — | — | — | — | |
| Eli Lilly & Co. | — | — | — | — | — | |
| Gilead Sciences Inc. | — | — | — | — | — | |
| Johnson & Johnson | — | — | — | — | — | |
| Merck & Co. Inc. | — | — | — | — | — | |
| Pfizer Inc. | — | — | — | — | — | |
| Regeneron Pharmaceuticals Inc. | — | — | — | — | — | |
| Thermo Fisher Scientific Inc. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).
1 2014 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 2.93 = 125
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Average payables payment period | An estimate of the average number of days it takes a company to pay its suppliers; equal to the number of days in the period divided by payables turnover ratio for the period. | Allergan Inc. number of days of payables outstanding increased from 2012 to 2013 but then slightly decreased from 2013 to 2014. |
Cash Conversion Cycle
Allergan Inc., cash conversion cycle calculation, comparison to benchmarks
No. days
| Dec 31, 2014 | Dec 31, 2013 | Dec 31, 2012 | Dec 31, 2011 | Dec 31, 2010 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Average inventory processing period | 128 | 131 | 133 | 122 | 116 | |
| Average receivable collection period | 47 | 52 | 49 | 50 | 49 | |
| Average payables payment period | 125 | 130 | 110 | 98 | 112 | |
| Short-term Activity Ratio | ||||||
| Cash conversion cycle1 | 50 | 53 | 72 | 74 | 53 | |
| Benchmarks | ||||||
| Cash Conversion Cycle, Competitors2 | ||||||
| AbbVie Inc. | — | — | — | — | — | |
| Amgen Inc. | — | — | — | — | — | |
| Bristol-Myers Squibb Co. | — | — | — | — | — | |
| Danaher Corp. | — | — | — | — | — | |
| Eli Lilly & Co. | — | — | — | — | — | |
| Gilead Sciences Inc. | — | — | — | — | — | |
| Johnson & Johnson | — | — | — | — | — | |
| Merck & Co. Inc. | — | — | — | — | — | |
| Pfizer Inc. | — | — | — | — | — | |
| Regeneron Pharmaceuticals Inc. | — | — | — | — | — | |
| Thermo Fisher Scientific Inc. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).
1 2014 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 128 + 47 – 125 = 50
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Cash conversion cycle | A financial metric that measures the length of time required for a company to convert cash invested in its operations to cash received as a result of its operations; equal to average inventory processing period plus average receivables collection period minus average payables payment period. | Allergan Inc. cash conversion cycle improved from 2012 to 2013 and from 2013 to 2014. |