Amphenol Corporation (APH)
Working capital turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 12,554,700 | 12,623,000 | 10,876,300 | 8,598,900 | 8,225,400 |
| Total current assets | US$ in thousands | 6,835,300 | 6,479,100 | 5,958,200 | 5,490,800 | 4,211,200 |
| Total current liabilities | US$ in thousands | 3,152,700 | 2,676,100 | 2,447,100 | 2,304,300 | 2,132,700 |
| Working capital turnover | 3.41 | 3.32 | 3.10 | 2.70 | 3.96 |
December 31, 2023 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $12,554,700K ÷ ($6,835,300K – $3,152,700K)
= 3.41
The working capital turnover ratio measures how efficiently a company is utilizing its working capital to generate sales revenue. A higher ratio indicates better utilization and more effective management of working capital.
For Amphenol Corp., the working capital turnover has been fluctuating over the past five years. It increased from 2.70 in 2020 to 3.41 in 2023, indicating an improvement in the company's ability to generate sales revenue from its working capital.
The consistent values above 3.00 suggest that Amphenol Corp. has been effectively managing its working capital to support its sales operations. This signifies that the company is efficiently utilizing its current assets and liabilities to drive revenue growth.
Overall, the trend of increasing working capital turnover ratios for Amphenol Corp. reflects a positive sign of the company's operational efficiency and effective management of its working capital in generating sales.