Air Products and Chemicals Inc (APD)

Working capital turnover

		Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020	Sep 30, 2019
Revenue	US$ in thousands	12,600,000	12,698,600	10,323,000	8,856,300	8,918,900
Total current assets	US$ in thousands	5,200,500	6,282,900	8,376,300	8,684,900	4,618,300
Total current liabilities	US$ in thousands	3,895,800	3,465,800	2,799,100	2,416,700	1,820,900
Working capital turnover		9.66	4.51	1.85	1.41	3.19

September 30, 2023 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $12,600,000K ÷ ($5,200,500K – $3,895,800K)
= 9.66

The working capital turnover of Air Products & Chemicals Inc. has shown a fluctuating trend over the past five years. The ratio increased from 3.19 in 2019 to 1.41 in 2020, indicating a less efficient use of working capital in 2020. However, a significant improvement was observed in 2021, with the ratio reaching 1.85, and further increasing to 4.51 in 2022 and notably to 9.66 in 2023, depicting a substantial enhancement in the efficiency of working capital utilization.

This trend suggests that the company has been able to generate more revenue relative to its working capital in 2023 compared to previous years. A higher working capital turnover ratio generally indicates that the company is effectively using its working capital to generate sales. This improvement may indicate potential strength in the company's liquidity and operational efficiency in recent years. However, a comprehensive analysis incorporating other financial metrics and qualitative factors is advisable to gain a holistic understanding of the company's operational and financial performance.