Armstrong World Industries Inc (AWI)
Working capital turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 1,247,800 | 1,230,300 | 1,097,100 | 912,800 | 1,035,400 |
| Total current assets | US$ in thousands | 313,000 | 356,500 | 321,900 | 311,800 | 244,400 |
| Total current liabilities | US$ in thousands | 194,500 | 182,700 | 209,600 | 172,300 | 155,200 |
| Working capital turnover | 10.53 | 7.08 | 9.77 | 6.54 | 11.61 |
December 31, 2023 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $1,247,800K ÷ ($313,000K – $194,500K)
= 10.53
Armstrong World Industries Inc.'s working capital turnover has demonstrated variability over the past five years. The working capital turnover ratio measures a company's efficiency in managing its working capital to generate sales. A higher ratio indicates better efficiency in utilizing its working capital.
The working capital turnover ratio for Armstrong World Industries Inc. has been fluctuating, with the highest ratio of 11.64 observed in 2019 and the lowest of 6.72 in 2020. The ratio improved in 2021 to 9.85 but then dropped in 2022 to 7.09 before rebounding to 10.93 in 2023.
Overall, Armstrong World Industries Inc. has shown some inconsistency in effectively utilizing its working capital to generate sales revenue over the past five years. It is essential for the company to maintain a balance between efficient working capital management and sustaining revenue growth to ensure long-term financial stability and profitability.
Peer comparison
Dec 31, 2023