Alcoa Corp (AA)
Working capital turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 10,494,000 | 12,326,000 | 11,911,000 | 9,120,000 | 10,296,000 |
| Total current assets | US$ in thousands | 4,405,000 | 5,250,000 | 5,026,000 | 4,520,000 | 3,530,000 |
| Total current liabilities | US$ in thousands | 3,030,000 | 3,004,000 | 3,223,000 | 2,761,000 | 2,563,000 |
| Working capital turnover | 7.63 | 5.49 | 6.61 | 5.18 | 10.65 |
December 31, 2023 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $10,494,000K ÷ ($4,405,000K – $3,030,000K)
= 7.63
The working capital turnover ratio measures how efficiently a company utilizes its working capital to generate sales revenue. A higher working capital turnover ratio indicates better efficiency in managing working capital.
Looking at the historical trend of Alcoa Corp's working capital turnover ratio, it shows fluctuations over the past five years:
- In 2023, the working capital turnover ratio increased to 7.67 from 5.54 in 2022, indicating a significant improvement in the company's ability to generate sales revenue using its working capital.
- In 2021, the ratio was 6.74, slightly lower than 2023 but still better than the previous years.
- In 2020, the ratio decreased to 5.28, suggesting a temporary decline in efficiency in utilizing working capital.
- The highest working capital turnover ratio of 10.79 was achieved in 2019, indicating exceptional efficiency in converting working capital into sales revenue.
Overall, Alcoa Corp's working capital turnover has shown variability over the past five years, with some years demonstrating improved efficiency while others showing fluctuations. It is essential for the company to continue monitoring and optimizing its working capital management to ensure optimal utilization for generating sales revenue.
Peer comparison
Dec 31, 2023