Commercial Metals Company (CMC)

Working capital turnover

		Feb 29, 2024	Nov 30, 2023	Aug 31, 2023	May 31, 2023	Feb 28, 2023	Nov 30, 2022	Aug 31, 2022	May 31, 2022	Feb 28, 2022	Nov 30, 2021	Aug 31, 2021	May 31, 2021	Feb 28, 2021	Nov 30, 2020	Aug 31, 2020	May 31, 2020	Feb 29, 2020	Nov 30, 2019	Aug 31, 2019	May 31, 2019
Revenue (ttm)	US$ in thousands	8,364,790	8,536,410	8,759,370	9,226,700	9,389,600	9,361,170	9,117,680	8,467,780	7,801,570	7,252,900	6,656,150	6,046,880	5,534,950	5,430,800	5,429,840	5,563,710	5,833,520	5,888,080	5,776,260	5,541,700
Total current assets	US$ in thousands	3,198,090	3,243,830	3,144,160	3,141,640	3,278,150	3,224,110	3,441,470	3,443,570	3,490,250	2,786,380	2,736,830	2,518,480	2,205,640	2,169,200	2,214,100	2,144,990	2,084,980	2,014,580	2,080,000	2,114,070
Total current liabilities	US$ in thousands	762,547	786,955	843,714	852,944	1,066,150	1,077,550	1,356,990	1,390,690	825,201	892,120	980,473	853,367	674,093	613,199	745,263	627,343	649,134	601,964	694,590	704,258
Working capital turnover		3.43	3.47	3.81	4.03	4.24	4.36	4.37	4.12	2.93	3.83	3.79	3.63	3.61	3.49	3.70	3.67	4.06	4.17	4.17	3.93

February 29, 2024 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $8,364,790K ÷ ($3,198,090K – $762,547K)
= 3.43

The working capital turnover ratio for Commercial Metals Company has exhibited fluctuations over the past few quarters, ranging from a low of 2.93 to a high of 4.37. This ratio measures how efficiently the company is utilizing its working capital to generate sales revenue. A higher ratio generally indicates better efficiency in managing working capital.

In analyzing the trend, we can observe that the ratio has been mostly above 3, indicating that the company is able to generate sales revenue at least three times the amount of its average working capital. This suggests that Commercial Metals Company has been relatively efficient in managing its working capital to support its revenue generation activities.

However, there are some fluctuations in the ratio, with some quarters showing higher efficiency (4.37 in Nov 30, 2022) and others showing lower efficiency (2.93 in Feb 28, 2022). This may indicate variations in the company's sales levels or changes in its working capital management practices during those periods.

Overall, the trend in the working capital turnover ratio for Commercial Metals Company suggests that the company has been generally effective in utilizing its working capital resources to support its revenue generation activities, although there have been some fluctuations in efficiency from quarter to quarter.