Baker Hughes Co (BKR)
Working capital turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 27,631,000 | 25,330,000 | 20,453,000 | 20,203,000 | 20,088,000 |
| Total current assets | US$ in thousands | 17,211,000 | 16,301,000 | 14,592,000 | 15,065,000 | 16,455,000 |
| Total current liabilities | US$ in thousands | 12,991,000 | 12,991,000 | 11,075,000 | 9,128,000 | 10,227,000 |
| Working capital turnover | 6.55 | 7.65 | 5.82 | 3.40 | 3.23 |
December 31, 2024 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $27,631,000K ÷ ($17,211,000K – $12,991,000K)
= 6.55
The working capital turnover of Baker Hughes Co has shown a steady improvement over the years. In 2020, the turnover ratio was 3.23, indicating that the company generated $3.23 in sales for every dollar of working capital invested. By the end of 2024, this ratio had increased to 6.55, highlighting a significant enhancement in the efficiency of utilizing working capital to generate sales.
The upward trend in working capital turnover signifies that Baker Hughes Co has effectively managed its working capital resources to support its operations and drive revenue growth. A higher turnover ratio generally indicates that the company is promptly converting its current assets into sales, reflecting operational efficiency and potentially better liquidity management.
The notable increase in working capital turnover from 2020 to 2024 suggests that Baker Hughes Co has made improvements in managing its inventory, receivables, and payables more efficiently over this period. This enhanced efficiency in utilizing working capital could lead to improved financial performance and overall profitability for the company.
Overall, the consistent improvement in working capital turnover for Baker Hughes Co signifies effective working capital management and operational success, positioning the company well for sustainable growth and profitability in the future.
Peer comparison
Dec 31, 2024