Altair Engineering Inc (ALTR)

Working capital turnover

Mar 31, 2024 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
Revenue (ttm) US$ in thousands 612,557 608,222 600,592 585,021 571,392 563,439 536,037 540,111 530,033 519,011 510,152 496,321 475,198 458,323 456,770 449,723 461,129 459,602 446,656 443,361
Total current assets US$ in thousands 730,399 700,623 592,006 586,781 548,602 526,826 465,731 554,314 555,674 588,221 579,505 382,647 378,756 386,935 359,803 351,954 357,471 352,457 360,948 364,363
Total current liabilities US$ in thousands 296,754 324,110 296,915 319,248 300,394 232,738 198,476 187,064 430,741 473,978 347,896 356,210 359,390 200,754 149,488 146,074 150,640 152,866 143,256 141,067
Working capital turnover 1.41 1.62 2.04 2.19 2.30 1.92 2.01 1.47 4.24 4.54 2.20 18.77 24.54 2.46 2.17 2.18 2.23 2.30 2.05 1.99

March 31, 2024 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $612,557K ÷ ($730,399K – $296,754K)
= 1.41

Altair Engineering Inc's working capital turnover has shown some fluctuations over the past few quarters. The working capital turnover ratio measures how efficiently the company is utilizing its working capital to generate sales revenue.

The ratio has generally been above 1, indicating that Altair Engineering Inc is efficiently using its working capital to generate revenue. A higher ratio is favorable as it suggests that the company is efficiently managing its current assets and liabilities to support its operations.

The ratio peaked at 24.54 in December 2020, indicating an exceptionally high level of efficiency in utilizing its working capital at that time. This could be attributed to effective management of inventory, accounts receivable, and accounts payable.

However, the ratio has fluctuated since then, showing a downward trend in recent quarters. This could indicate changes in the company's operating cycle, shifts in the industry, or adjustments in working capital management strategies.

Overall, Altair Engineering Inc's working capital turnover ratio has demonstrated efficiency in utilizing its working capital to generate revenue, but the fluctuations warrant further analysis to understand the underlying reasons behind the changes observed in recent periods.