Analysis of Long-term (Investment) Activity Ratios
Activity ratios measure how efficiently a company performs day-to-day tasks, such us the collection of receivables and management of inventory.
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LyondellBasell Industries N.V. pages available for free this week:
- Balance Sheet: Liabilities and Stockholders’ Equity
- Common-Size Income Statement
- Analysis of Liquidity Ratios
- Capital Asset Pricing Model (CAPM)
- Dividend Discount Model (DDM)
- Return on Equity (ROE) since 2011
- Return on Assets (ROA) since 2011
- Price to Book Value (P/BV) since 2011
- Analysis of Revenues
- Aggregate Accruals
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Long-term Activity Ratios (Summary)
LyondellBasell Industries N.V., long-term (investment) activity ratios
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| Net fixed asset turnover | ||||||
| Total asset turnover | ||||||
| Equity turnover |
Based on: 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31).
- Net Fixed Asset Turnover
- The net fixed asset turnover ratio shows a declining trend from 5.21 in 2014 to 2.88 in 2016, indicating a reduction in efficiency in generating sales from net fixed assets over those years. Although a slight recovery is observed in 2017 to 3.14, the ratio remains relatively stable in 2018 at 3.13. Overall, the ratio has decreased significantly compared to the initial value in 2014, suggesting a potential decrease in the utilization efficiency of fixed assets.
- Total Asset Turnover
- The total asset turnover ratio experiences a consistent downward trend from 1.88 in 2014 to 1.24 in 2016, reflecting diminishing effectiveness in using total assets to generate sales during this period. Following this decline, a gradual improvement is noted in 2017 and 2018, with ratios increasing to 1.32 and 1.38 respectively. Despite this recovery, the turnover remains below the 2014 level, indicating a partial inefficiency in asset utilization over the analyzed timeframe.
- Equity Turnover
- The equity turnover ratio decreases steadily from 5.49 in 2014 to 3.8 in 2018. This consistent decline indicates reduced efficiency in generating sales from equity capital. The most notable drop occurs between 2016 and 2017, where the ratio falls from 4.83 to 3.85, continuing to dip slightly in the following year. The sustained downturn may suggest changes in equity structure or operational dynamics affecting shareholder capital productivity.
Net Fixed Asset Turnover
LyondellBasell Industries N.V., net fixed asset turnover calculation, comparison to benchmarks
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Sales and other operating revenues | ||||||
| Property, plant and equipment, net | ||||||
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover1 | ||||||
| Benchmarks | ||||||
| Net Fixed Asset Turnover, Competitors2 | ||||||
| Linde plc | ||||||
| Sherwin-Williams Co. | ||||||
Based on: 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31).
1 2018 Calculation
Net fixed asset turnover = Sales and other operating revenues ÷ Property, plant and equipment, net
= ÷ =
2 Click competitor name to see calculations.
- Sales and Other Operating Revenues
- There is a notable decline in sales and other operating revenues from 2014 to 2016, with values decreasing significantly from 45,608 million US dollars in 2014 to 29,183 million US dollars in 2016. However, from 2016 onwards, revenues demonstrate a recovery trend, rising to 34,484 million in 2017 and further to 39,004 million in 2018. This pattern indicates a period of contraction followed by gradual growth.
- Property, Plant and Equipment, Net
- The net value of property, plant, and equipment shows a consistent upward trend throughout the period. Starting at 8,758 million US dollars in 2014, the value increases steadily each year, reaching 12,477 million in 2018. This indicates ongoing investment in fixed assets or capital expenditures over the years under review.
- Net Fixed Asset Turnover
- The net fixed asset turnover ratio, which measures the efficiency of fixed assets in generating sales, shows a declining trend from 5.21 in 2014 to 2.88 in 2016. Although there is a slight rebound to 3.14 in 2017, the ratio stabilizes around 3.13 in 2018. This decline followed by stabilization suggests reduced efficiency in utilizing fixed assets during the initial years, with some improvement but not a full recovery by 2018.
- Overall Analysis
- The data suggests that while the company faced reduced sales and operating revenues during 2015 and 2016, it simultaneously invested in increasing its property, plant, and equipment. This investment was not immediately matched by proportional revenue growth, as evidenced by the decreasing net fixed asset turnover. The subsequent recovery in sales from 2017 onwards, coupled with a stable fixed asset turnover ratio near 3.13, may reflect improved asset utilization and operational performance, though efficiency has not returned to the levels seen in 2014.
Total Asset Turnover
LyondellBasell Industries N.V., total asset turnover calculation, comparison to benchmarks
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Sales and other operating revenues | ||||||
| Total assets | ||||||
| Long-term Activity Ratio | ||||||
| Total asset turnover1 | ||||||
| Benchmarks | ||||||
| Total Asset Turnover, Competitors2 | ||||||
| Linde plc | ||||||
| Sherwin-Williams Co. | ||||||
Based on: 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31).
1 2018 Calculation
Total asset turnover = Sales and other operating revenues ÷ Total assets
= ÷ =
2 Click competitor name to see calculations.
- Sales and Other Operating Revenues
- Sales and other operating revenues showed a declining trend from 2014 to 2016, falling from 45,608 million US dollars to 29,183 million US dollars. However, from 2016 onwards, a recovery is observed with revenues increasing to 34,484 million US dollars in 2017 and further to 39,004 million US dollars in 2018, indicating a partial rebound though not reaching the 2014 peak levels.
- Total Assets
- Total assets exhibited a decreasing trend initially, dropping from 24,283 million US dollars in 2014 to 22,757 million US dollars in 2015. Subsequently, assets remained relatively stable with a slight increase to 23,442 million US dollars in 2016 and more pronounced growth in 2017 and 2018, reaching 26,206 million and 28,278 million US dollars respectively. This suggests a strengthening asset base in the later years after the initial decline.
- Total Asset Turnover
- Total asset turnover declined consistently from 1.88 in 2014 to 1.24 in 2016, reflecting reduced efficiency in generating sales from assets during this period. From 2016 onwards, the ratio improved to 1.32 in 2017 and 1.38 in 2018, signaling an enhancement in asset utilization but still below the 2014 level. The trend mirrors that of sales performance and asset growth, indicating a recovery phase in operational efficiency.
- Summary
- Overall, the data reveals an initial downturn in both sales and total assets during 2014-2016, accompanied by a decline in asset turnover, pointing to reduced operational efficiency and scale. From 2017 onwards, there is a clear trend of recovery with increasing revenues, asset growth, and improved asset turnover ratios, although the levels have not yet returned to those observed in 2014. This pattern suggests a period of contraction followed by gradual stabilization and growth.
Equity Turnover
LyondellBasell Industries N.V., equity turnover calculation, comparison to benchmarks
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Sales and other operating revenues | ||||||
| Total Company share of stockholders’ equity | ||||||
| Long-term Activity Ratio | ||||||
| Equity turnover1 | ||||||
| Benchmarks | ||||||
| Equity Turnover, Competitors2 | ||||||
| Linde plc | ||||||
| Sherwin-Williams Co. | ||||||
Based on: 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31).
1 2018 Calculation
Equity turnover = Sales and other operating revenues ÷ Total Company share of stockholders’ equity
= ÷ =
2 Click competitor name to see calculations.
The financial data indicates notable trends across the five-year period ending December 31, 2018.
- Sales and Other Operating Revenues
- Sales experienced a significant decrease from 2014 to 2016, dropping sharply from $45,608 million in 2014 to $29,183 million in 2016. However, from 2016 onwards, there was a recovery trend, with sales increasing to $34,484 million in 2017 and further to $39,004 million in 2018. Despite the recovery, the sales figures in 2018 remained below the 2014 peak.
- Total Company Share of Stockholders’ Equity
- The total equity displayed a fluctuating yet generally upward trend over the period. Starting at $8,314 million in 2014, equity decreased over the next two years to $6,048 million in 2016. After this trough, there was a notable rebound with equity increasing substantially to $8,949 million in 2017 and continuing upward to $10,257 million in 2018, surpassing the initial 2014 level.
- Equity Turnover Ratio
- The equity turnover ratio showed a steady decline throughout the period. Beginning at a high of 5.49 in 2014, it decreased annually, reaching 3.80 by 2018. This downward trend suggests a reduction in the efficiency with which the company uses its equity to generate sales over time.