Allegion PLC (ALLE)
Working capital turnover
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (ttm) | US$ in thousands | 3,553,800 | 3,529,000 | 3,524,800 | 3,385,400 | 3,186,000 | 3,072,600 | 2,875,900 | 2,849,700 | 2,820,400 | 2,833,700 | 2,845,100 | 2,687,700 | 2,668,100 | 2,621,500 | 2,641,400 | 2,783,100 | 2,763,400 | 2,783,600 | 2,746,800 | 2,720,300 |
| Total current assets | US$ in thousands | 1,360,900 | 1,320,100 | 1,275,200 | 1,253,400 | 1,214,600 | 1,235,900 | 1,753,000 | 1,077,300 | 1,117,600 | 1,202,400 | 1,144,200 | 1,048,000 | 1,145,000 | 1,121,000 | 977,100 | 922,000 | 1,001,800 | 933,100 | 883,200 | 850,200 |
| Total current liabilities | US$ in thousands | 1,079,700 | 649,800 | 660,800 | 668,500 | 703,600 | 689,200 | 610,400 | 581,500 | 601,200 | 793,900 | 564,100 | 505,600 | 521,500 | 489,100 | 463,700 | 456,700 | 507,000 | 491,200 | 517,100 | 485,400 |
| Working capital turnover | 12.64 | 5.26 | 5.74 | 5.79 | 6.23 | 5.62 | 2.52 | 5.75 | 5.46 | 6.94 | 4.90 | 4.96 | 4.28 | 4.15 | 5.14 | 5.98 | 5.58 | 6.30 | 7.50 | 7.46 |
December 31, 2023 calculation
Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $3,553,800K ÷ ($1,360,900K – $1,079,700K)
= 12.64
Allegion plc's working capital turnover has shown fluctuating trends over the past eight quarters. In Q4 2023, the working capital turnover ratio was 12.98, indicating that the company generated $12.98 in revenue for every dollar of working capital invested. This represents a significant improvement compared to the previous quarter, where the ratio was 5.39.
The peak performance in Q4 2023 suggests that Allegion plc efficiently managed its working capital to generate sales. However, it is essential to note that the ratio was significantly lower in Q2 2022 at 2.56, indicating that the company may have experienced challenges in efficiently utilizing its working capital during that period.
Overall, the increasing trend in the working capital turnover ratio in recent quarters reflects potential improvements in Allegion plc's working capital management and operational efficiency. Investors and stakeholders may view this positively as it indicates the company's ability to generate revenue relative to its investment in working capital.