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)
Hershey Co., short-term (operating) activity ratios
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
| Short-term activity ratio | Description | The company |
|---|---|---|
| Inventory turnover | An activity ratio calculated as cost of goods sold divided by inventory. | Hershey Co. inventory turnover ratio improved from 2020 to 2021 and from 2021 to 2022. |
| Receivables turnover | An activity ratio equal to revenue divided by receivables. | Hershey Co. receivables turnover ratio improved from 2020 to 2021 and from 2021 to 2022. |
| Payables turnover | An activity ratio calculated as cost of goods sold divided by payables. | Hershey Co. payables turnover ratio decreased from 2020 to 2021 and from 2021 to 2022. |
| 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. | Hershey Co. number of days of inventory outstanding improved from 2020 to 2021 and from 2021 to 2022. |
| Average receivable collection period | An activity ratio equal to the number of days in the period divided by receivables turnover. | Hershey Co. number of days of receivables outstanding improved from 2020 to 2021 and from 2021 to 2022. |
| Operating cycle | Equal to average inventory processing period plus average receivables collection period. | Hershey Co. operating cycle improved from 2020 to 2021 and from 2021 to 2022. |
| 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. | Hershey Co. number of days of payables outstanding increased from 2020 to 2021 and from 2021 to 2022. |
| 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. | Hershey Co. cash conversion cycle improved from 2020 to 2021 and from 2021 to 2022. |
Inventory Turnover
Hershey Co., inventory turnover calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Cost of sales | 5,920,509) | 4,922,739) | 4,448,450) | 4,363,774) | 4,215,744) | |
| Inventories | 1,173,119) | 988,511) | 964,207) | 815,251) | 784,879) | |
| Short-term Activity Ratio | ||||||
| Inventory turnover1 | 5.05 | 4.98 | 4.61 | 5.35 | 5.37 | |
| Benchmarks | ||||||
| Inventory Turnover, Competitors2 | ||||||
| Altria Group Inc. | 5.46 | 5.96 | 3.98 | 3.09 | — | |
| Coca-Cola Co. | 4.25 | 4.50 | 4.11 | 4.33 | — | |
| PepsiCo Inc. | 7.77 | 8.53 | 7.62 | 9.03 | — | |
| Philip Morris International Inc. | 1.15 | 1.15 | 1.00 | 1.14 | — | |
| Inventory Turnover, Sector | ||||||
| Food, Beverage & Tobacco | 3.72 | 3.94 | 3.30 | 3.42 | — | |
| Inventory Turnover, Industry | ||||||
| Consumer Staples | 6.96 | 7.97 | 7.50 | 7.42 | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
Inventory turnover = Cost of sales ÷ Inventories
= 5,920,509 ÷ 1,173,119 = 5.05
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. | Hershey Co. inventory turnover ratio improved from 2020 to 2021 and from 2021 to 2022. |
Receivables Turnover
Hershey Co., receivables turnover calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net sales | 10,419,294) | 8,971,337) | 8,149,719) | 7,986,252) | 7,791,069) | |
| Accounts receivable, trade, net | 711,203) | 671,464) | 615,233) | 568,509) | 594,145) | |
| Short-term Activity Ratio | ||||||
| Receivables turnover1 | 14.65 | 13.36 | 13.25 | 14.05 | 13.11 | |
| Benchmarks | ||||||
| Receivables Turnover, Competitors2 | ||||||
| Altria Group Inc. | 522.83 | 553.47 | 190.90 | 165.20 | — | |
| Coca-Cola Co. | 12.33 | 11.01 | 10.50 | 9.38 | — | |
| PepsiCo Inc. | 8.50 | 9.16 | 8.37 | 8.59 | — | |
| Philip Morris International Inc. | 8.25 | 10.06 | 9.88 | 9.68 | — | |
| Receivables Turnover, Sector | ||||||
| Food, Beverage & Tobacco | 10.61 | 11.43 | 10.85 | 10.61 | — | |
| Receivables Turnover, Industry | ||||||
| Consumer Staples | 35.12 | 38.75 | 37.54 | 34.71 | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
Receivables turnover = Net sales ÷ Accounts receivable, trade, net
= 10,419,294 ÷ 711,203 = 14.65
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. | Hershey Co. receivables turnover ratio improved from 2020 to 2021 and from 2021 to 2022. |
Payables Turnover
Hershey Co., payables turnover calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Cost of sales | 5,920,509) | 4,922,739) | 4,448,450) | 4,363,774) | 4,215,744) | |
| Accounts payable | 970,558) | 692,338) | 580,058) | 550,828) | 502,314) | |
| Short-term Activity Ratio | ||||||
| Payables turnover1 | 6.10 | 7.11 | 7.67 | 7.92 | 8.39 | |
| Benchmarks | ||||||
| Payables Turnover, Competitors2 | ||||||
| Altria Group Inc. | 11.67 | 15.86 | 20.57 | 21.80 | — | |
| Coca-Cola Co. | 3.39 | 3.34 | 3.82 | 3.84 | — | |
| PepsiCo Inc. | 3.78 | 3.77 | 3.59 | 3.76 | — | |
| Philip Morris International Inc. | 2.80 | 3.01 | 3.44 | 4.57 | — | |
| Payables Turnover, Sector | ||||||
| Food, Beverage & Tobacco | 3.70 | 3.82 | 4.03 | 4.32 | — | |
| Payables Turnover, Industry | ||||||
| Consumer Staples | 6.61 | 6.91 | 7.01 | 7.11 | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
Payables turnover = Cost of sales ÷ Accounts payable
= 5,920,509 ÷ 970,558 = 6.10
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. | Hershey Co. payables turnover ratio decreased from 2020 to 2021 and from 2021 to 2022. |
Working Capital Turnover
Hershey Co., working capital turnover calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Current assets | 2,620,406) | 2,246,206) | 2,977,905) | 2,117,102) | 2,239,181) | |
| Less: Current liabilities | 3,257,154) | 2,493,313) | 1,891,745) | 2,008,793) | 2,418,566) | |
| Working capital | (636,748) | (247,107) | 1,086,160) | 108,309) | (179,385) | |
| Net sales | 10,419,294) | 8,971,337) | 8,149,719) | 7,986,252) | 7,791,069) | |
| Short-term Activity Ratio | ||||||
| Working capital turnover1 | — | — | 7.50 | 73.74 | — | |
| Benchmarks | ||||||
| Working Capital Turnover, Competitors2 | ||||||
| Altria Group Inc. | — | — | — | — | — | |
| Coca-Cola Co. | 15.00 | 14.90 | 7.12 | — | — | |
| PepsiCo Inc. | — | — | — | — | — | |
| Philip Morris International Inc. | — | — | 15.29 | 17.73 | — | |
| Working Capital Turnover, Sector | ||||||
| Food, Beverage & Tobacco | — | — | 37.68 | — | — | |
| Working Capital Turnover, Industry | ||||||
| Consumer Staples | — | — | — | — | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
Working capital turnover = Net sales ÷ Working capital
= 10,419,294 ÷ -636,748 = —
2 Click competitor name to see calculations.
Average Inventory Processing Period
Hershey Co., average inventory processing period calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Inventory turnover | 5.05 | 4.98 | 4.61 | 5.35 | 5.37 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average inventory processing period1 | 72 | 73 | 79 | 68 | 68 | |
| Benchmarks (no. days) | ||||||
| Average Inventory Processing Period, Competitors2 | ||||||
| Altria Group Inc. | 67 | 61 | 92 | 118 | — | |
| Coca-Cola Co. | 86 | 81 | 89 | 84 | — | |
| PepsiCo Inc. | 47 | 43 | 48 | 40 | — | |
| Philip Morris International Inc. | 316 | 317 | 366 | 321 | — | |
| Average Inventory Processing Period, Sector | ||||||
| Food, Beverage & Tobacco | 98 | 93 | 111 | 107 | — | |
| Average Inventory Processing Period, Industry | ||||||
| Consumer Staples | 52 | 46 | 49 | 49 | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 5.05 = 72
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. | Hershey Co. number of days of inventory outstanding improved from 2020 to 2021 and from 2021 to 2022. |
Average Receivable Collection Period
Hershey Co., average receivable collection period calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Receivables turnover | 14.65 | 13.36 | 13.25 | 14.05 | 13.11 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average receivable collection period1 | 25 | 27 | 28 | 26 | 28 | |
| Benchmarks (no. days) | ||||||
| Average Receivable Collection Period, Competitors2 | ||||||
| Altria Group Inc. | 1 | 1 | 2 | 2 | — | |
| Coca-Cola Co. | 30 | 33 | 35 | 39 | — | |
| PepsiCo Inc. | 43 | 40 | 44 | 43 | — | |
| Philip Morris International Inc. | 44 | 36 | 37 | 38 | — | |
| Average Receivable Collection Period, Sector | ||||||
| Food, Beverage & Tobacco | 34 | 32 | 34 | 34 | — | |
| Average Receivable Collection Period, Industry | ||||||
| Consumer Staples | 10 | 9 | 10 | 11 | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 14.65 = 25
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. | Hershey Co. number of days of receivables outstanding improved from 2020 to 2021 and from 2021 to 2022. |
Operating Cycle
Hershey Co., operating cycle calculation, comparison to benchmarks
No. days
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Average inventory processing period | 72 | 73 | 79 | 68 | 68 | |
| Average receivable collection period | 25 | 27 | 28 | 26 | 28 | |
| Short-term Activity Ratio | ||||||
| Operating cycle1 | 97 | 100 | 107 | 94 | 96 | |
| Benchmarks | ||||||
| Operating Cycle, Competitors2 | ||||||
| Altria Group Inc. | 68 | 62 | 94 | 120 | — | |
| Coca-Cola Co. | 116 | 114 | 124 | 123 | — | |
| PepsiCo Inc. | 90 | 83 | 92 | 83 | — | |
| Philip Morris International Inc. | 360 | 353 | 403 | 359 | — | |
| Operating Cycle, Sector | ||||||
| Food, Beverage & Tobacco | 132 | 125 | 145 | 141 | — | |
| Operating Cycle, Industry | ||||||
| Consumer Staples | 62 | 55 | 59 | 60 | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= 72 + 25 = 97
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. | Hershey Co. operating cycle improved from 2020 to 2021 and from 2021 to 2022. |
Average Payables Payment Period
Hershey Co., average payables payment period calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Payables turnover | 6.10 | 7.11 | 7.67 | 7.92 | 8.39 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average payables payment period1 | 60 | 51 | 48 | 46 | 43 | |
| Benchmarks (no. days) | ||||||
| Average Payables Payment Period, Competitors2 | ||||||
| Altria Group Inc. | 31 | 23 | 18 | 17 | — | |
| Coca-Cola Co. | 108 | 109 | 96 | 95 | — | |
| PepsiCo Inc. | 97 | 97 | 102 | 97 | — | |
| Philip Morris International Inc. | 130 | 121 | 106 | 80 | — | |
| Average Payables Payment Period, Sector | ||||||
| Food, Beverage & Tobacco | 99 | 96 | 91 | 85 | — | |
| Average Payables Payment Period, Industry | ||||||
| Consumer Staples | 55 | 53 | 52 | 51 | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 6.10 = 60
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. | Hershey Co. number of days of payables outstanding increased from 2020 to 2021 and from 2021 to 2022. |
Cash Conversion Cycle
Hershey Co., cash conversion cycle calculation, comparison to benchmarks
No. days
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Average inventory processing period | 72 | 73 | 79 | 68 | 68 | |
| Average receivable collection period | 25 | 27 | 28 | 26 | 28 | |
| Average payables payment period | 60 | 51 | 48 | 46 | 43 | |
| Short-term Activity Ratio | ||||||
| Cash conversion cycle1 | 37 | 49 | 59 | 48 | 53 | |
| Benchmarks | ||||||
| Cash Conversion Cycle, Competitors2 | ||||||
| Altria Group Inc. | 37 | 39 | 76 | 103 | — | |
| Coca-Cola Co. | 8 | 5 | 28 | 28 | — | |
| PepsiCo Inc. | -7 | -14 | -10 | -14 | — | |
| Philip Morris International Inc. | 230 | 232 | 297 | 279 | — | |
| Cash Conversion Cycle, Sector | ||||||
| Food, Beverage & Tobacco | 33 | 29 | 54 | 56 | — | |
| Cash Conversion Cycle, Industry | ||||||
| Consumer Staples | 7 | 2 | 7 | 9 | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 72 + 25 – 60 = 37
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. | Hershey Co. cash conversion cycle improved from 2020 to 2021 and from 2021 to 2022. |