ArcBest Corp (ARCB)

Working capital turnover

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 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
Revenue (ttm) US$ in thousands 4,182,550 4,265,140 4,329,760 4,354,670 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
Total current assets US$ in thousands 675,642 691,909 767,213 758,478 884,783 890,136 865,190 917,030 989,783 998,028 935,557 860,579 776,053 953,126 843,531 768,719 758,168 730,240 902,043 869,531
Total current liabilities US$ in thousands 665,985 665,568 645,850 618,575 701,563 668,374 641,266 688,043 768,470 757,372 748,169 740,111 702,694 615,676 560,260 500,742 506,547 497,516 439,652 422,853
Working capital turnover 433.11 161.92 35.68 31.13 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

December 31, 2024 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $4,182,550K ÷ ($675,642K – $665,985K)
= 433.11

The working capital turnover ratio is a measure of how efficiently a company is utilizing its working capital to generate sales revenue. It indicates the number of times a company's working capital is being used to support its sales activities over a specific period.

Analyzing the working capital turnover of ArcBest Corp over the given time period shows some fluctuations and notable trends. The ratio increased steadily from March 31, 2020, to September 30, 2021, indicating improved efficiency in utilizing working capital to generate sales. This suggests that the company was effectively managing its working capital to support its sales operations during this period.

A significant spike in the working capital turnover ratio is observed between December 31, 2021, and September 30, 2024. The ratio increased dramatically from 54.50 to 433.11, indicating a substantial improvement in efficiency in turning working capital into sales revenue during this period. This remarkable increase may reflect tighter working capital management and more effective operation of the company's sales activities.

However, from September 30, 2024, to December 31, 2024, there was a substantial decline in the working capital turnover ratio from 161.92 to 433.11, which could signal a potential decrease in operational efficiency or changes in the company's working capital management strategies during that quarter.

Overall, the trend in ArcBest Corp's working capital turnover ratio shows periods of both improvement and fluctuations. It is essential for stakeholders to monitor these ratios continuously to assess the company's efficiency in utilizing its working capital to generate sales and identify any potential operational or financial management challenges that may arise.