Financial indicators
Working Capital Ratios
1. Working Capital and Industrial Working Capital
- The Working Capital enables the Group to evaluate the balance between inventories, what is owed by customers and what should be paid suppliers.
WC = Inventories + Receivables - Payables
To improve the WC, inventories should be reduced, short payment conditions with our customers should be negotiated and, in contrast, advantageous payment conditions with our suppliers should be arranged.
- Working Capital includes
TOT-A300 | + Total Inventories | |||
STOT-A300 | + Inventories - Gross | |||
A31000 | + Inventory: raw materials | |||
A34000 | + Inventory: work-in-progress | |||
A37000 | + Inventory: finished and semi-finished goods | |||
STOT-A390 | + Inventories - Write-down | |||
A39100 | + Inventory write-down: raw materials | |||
A39400 | + Inventory write-down: work-in-progress | |||
A39700 | + Inventory write-down: finished and semi-finished goods | |||
| + Total Receivables | |||
STOT-A410 | + Trade receivables | |||
A41100 | + Trade receivables | |||
A49100 | + Trade receivables - Write-down | |||
TOT-A400 | + Other short-term receivables | |||
STOT-A400 | + Other short-term receivables - Gross | |||
| Excluding | |||
A44100 | - Income taxes receivable | |||
A46100 | - Dividends receivable | |||
STOT-A490 | + Other short-term receivables - Write-down | |||
| - Total Payables | |||
L40100 | + Trade payables | |||
| L40800 | + Fixed assets suppliers | |||
STOT-L400 | + Other short-term payables | |||
| Excluding | |||
L44800 | - Income taxes payable | |||
L46930 |
|
|
| - Dividends payable |
- Industrial Working Capital
Industrial Working Capital = Working capital as stated above
EXCUDING Other ST receivables/payables and fixed assets suppliers
But INCLUDING:
- A40160 - Advances paid to suppliers
- L41160 - Advances received from customers
2. Working Capital Ratios
Sales and costs annualization should be computed as following:
- On January month → Sales annualized (Sales A) = Sales on Jan. x 12
- On February month → Sales A = (Sales Jan. + Sales Feb) x 6
- On month M dated from March → Sales A = Σ (Sales on M month+ M-1 month + M-2 month) x 4
Due to structure effects, we don’t use the monthly Y-1 Sales.
From March, we used the last 3 months of sales = compatibility with overdues.
For these ratios, advances (paid and received) and transferred receivables (related to securitization) are not deducted.
2.1. Inventories
Inventories in days of VC + NVC = 365 * Inventories / - (VC + NVC Annualized) like sales calculations.
ST-CP-PM | VC = Product Market VC | |||
R15400 | + Proportional costs of sales - Standard | |||
R15410 |
|
|
| + Actual/Standard variance - Proportional costs of sales |
| R15430 | + Elimination of margin in inventories | |||
ST-CNP-PM | NVC = Product Market NVC | |||
R25490 | + Non-proportional costs of production | |||
R25460 | + Period non-proportional costs linked to production | |||
R25470 | + Absorption of non-proportional costs linked to production | |||
R25410 | + Actual/Standard variance - Non-proportional costs of production | |||
STOT-R258 |
|
|
| + Production depreciation - actual |
2.2. Receivables
- Total Receivables in days of Sales = 365 * Total receivables / Total Sales annualized
- Product/Market (PM) Receivables in days of PM Sales = 365 * PM Receivables / PM Sales Annualized
- Services Receivables in days of Services Sales = 365 * Services Receivables / Services Sales Annualized
2.3. Payables
- Total payables in days of VC = 365 * Payables / - (VC PM + VC Services) Annualized
- PM Payables in days of VC = 365 * PM Payables / - VC PM Annualized