Albemarle Corp (ALB)

Working capital turnover

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Revenue	US$ in thousands	5,377,530	9,617,200	7,320,100	3,327,960	3,128,910
Total current assets	US$ in thousands	3,842,260	5,216,920	5,186,920	1,993,680	2,206,180
Total current liabilities	US$ in thousands	1,966,460	3,560,460	2,741,020	1,874,340	1,801,850
Working capital turnover		2.87	5.81	2.99	27.89	7.74

December 31, 2024 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $5,377,530K ÷ ($3,842,260K – $1,966,460K)
= 2.87

Based on the provided data for Albemarle Corp, the working capital turnover ratio has fluctuated over the years.

- As of December 31, 2020, the working capital turnover ratio was 7.74, indicating that the company generated $7.74 in revenue for every dollar of working capital invested.
- This ratio significantly increased to 27.89 by December 31, 2021, showcasing a remarkable improvement in efficiency in utilizing its working capital to generate revenue.
- However, there was a notable decline in efficiency by December 31, 2022, with the ratio dropping to 2.99, which suggests a decrease in the company's ability to efficiently convert working capital into sales.
- The ratio rebounded to 5.81 by December 31, 2023, signaling a recovery in efficiency but still below the 2021 level.
- By December 31, 2024, the working capital turnover ratio further decreased to 2.87, potentially indicating challenges in managing working capital efficiently.

Overall, the fluctuation in the working capital turnover ratio for Albemarle Corp reflects varying degrees of effectiveness in utilizing its working capital to generate revenue over the years. Further analysis and comparison with industry benchmarks would provide additional insights into the company's operational efficiency and financial performance.