ArcBest Corp (ARCB)

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	4,493,120	4,653,130	4,876,850	5,166,410	5,326,350	5,274,290	4,938,980	4,495,079	3,997,842	3,620,356	3,398,646	3,076,929	2,942,547	2,843,551	2,836,113	2,980,260	2,988,521	3,045,382	3,083,878	3,105,669
Total current assets	US$ in thousands	884,783	890,136	865,190	917,030	989,783	998,028	935,557	860,579	776,053	953,126	843,531	768,719	758,168	730,240	902,043	869,531	664,402	657,988	651,450	606,542
Total current liabilities	US$ in thousands	701,563	668,374	641,266	688,043	768,470	757,372	748,169	740,111	702,694	615,676	560,260	500,742	506,547	497,516	439,652	422,853	444,277	465,725	471,474	431,835
Working capital turnover		24.52	20.98	21.78	22.56	24.07	21.92	26.36	37.31	54.50	10.73	12.00	11.48	11.69	12.22	6.13	6.67	13.58	15.84	17.13	17.78

December 31, 2023 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $4,493,120K ÷ ($884,783K – $701,563K)
= 24.52

ArcBest Corp's working capital turnover has shown some fluctuations over the past eight quarters. The working capital turnover ratio measures how efficiently a company is managing its working capital to generate revenue. A higher ratio signifies that the company is effectively utilizing its available working capital to generate sales.

Looking at the data provided, it is observed that ArcBest Corp's working capital turnover ratio has ranged from a low of 20.66 in Q3 2023 to a high of 37.24 in Q1 2022 over the past two years. A general increasing trend can be observed from Q2 2022 through to Q1 2023, with a sharp decline in Q2 2023, followed by a slight increase in Q3 2023.

The peak in Q1 2022 indicates that ArcBest Corp was able to generate $37.24 in revenue for every dollar of working capital invested during that period. However, the subsequent decrease in the ratio in the following quarters suggests a potential decrease in the efficiency of working capital management.

It is essential for ArcBest Corp to closely monitor and analyze the factors contributing to these fluctuations in the working capital turnover to ensure optimal utilization of working capital resources and sustained operational efficiency and profitability.