Smith AO Corporation (AOS)
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 | 3,840,800 | 3,786,500 | 3,723,200 | 3,730,700 | 3,744,500 | 3,805,900 | 3,847,700 | 3,742,800 | 3,534,600 | 3,375,000 | 3,219,800 | 3,022,300 | 2,889,000 | 2,805,400 | 2,772,100 | 2,872,700 | 2,984,200 | 3,045,800 | 3,072,800 | 3,141,800 |
| Total current assets | US$ in thousands | 1,500,300 | 1,504,500 | 1,561,300 | 1,643,800 | 1,633,700 | 1,569,600 | 1,631,200 | 1,721,400 | 1,752,600 | 1,738,100 | 1,585,700 | 1,558,200 | 1,618,000 | 1,430,300 | 1,444,400 | 1,442,500 | 1,500,400 | 1,504,400 | 1,596,600 | 1,658,100 |
| Total current liabilities | US$ in thousands | 945,300 | 895,600 | 860,700 | 895,700 | 934,200 | 900,900 | 928,300 | 1,002,100 | 1,118,800 | 982,600 | 907,000 | 836,100 | 886,300 | 805,900 | 735,400 | 699,100 | 766,500 | 730,400 | 730,600 | 737,200 |
| Working capital turnover | 6.92 | 6.22 | 5.31 | 4.99 | 5.35 | 5.69 | 5.47 | 5.20 | 5.58 | 4.47 | 4.74 | 4.19 | 3.95 | 4.49 | 3.91 | 3.86 | 4.07 | 3.94 | 3.55 | 3.41 |
December 31, 2023 calculation
Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $3,840,800K ÷ ($1,500,300K – $945,300K)
= 6.92
A.O. Smith Corp.'s working capital turnover has shown some fluctuations in recent quarters. The working capital turnover ratio indicates how efficiently the company is utilizing its working capital to generate sales revenue. A higher turnover ratio indicates more efficient utilization of working capital.
In Q4 2023, the working capital turnover stood at 6.94, the highest among the listed periods, reflecting a strong efficiency in converting working capital into sales. This may suggest effective management of the company's current assets and liabilities.
The ratio dipped to 6.24 in Q3 2023 but remained relatively high compared to previous quarters. Despite the slight decrease, the company still maintained a good level of efficiency in utilizing its working capital.
In Q2 and Q1 2023, the working capital turnover further decreased to 5.33 and 5.00, respectively. Although still above the ratios from the previous year, these figures indicate a slight decline in efficiency in managing working capital compared to the previous quarters.
Comparing the recent performance with the same quarters in 2022, it can be observed that the working capital turnover has generally been higher in 2023. This suggests that A.O. Smith Corp. has become more efficient in utilizing its working capital to generate sales revenue over the year.
Overall, A.O. Smith Corp.'s working capital turnover has shown some variability but has mostly remained at a favorable level, indicating efficient management of working capital resources.
Peer comparison
Dec 31, 2023