Dorman Products Inc (DORM)

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 1,893,680 1,901,551 1,836,706 1,784,557 1,718,167 1,624,260 1,560,827 1,455,608 1,343,272 1,247,556 1,200,483 1,123,030 1,095,246 1,033,597 986,773 1,007,766 991,329 1,012,103 1,006,261 1,228,380
Total current assets US$ in thousands 1,233,710 1,195,360 1,188,780 1,189,740 1,269,120 1,177,020 1,131,060 1,088,200 1,076,580 1,013,140 974,609 966,637 922,931 870,875 886,700 854,260 754,590 724,850 724,321 634,574
Total current liabilities US$ in thousands 547,151 533,048 570,371 606,923 678,295 673,878 660,335 652,618 665,048 622,760 332,528 335,417 322,645 279,400 325,641 314,537 220,502 195,552 214,483 133,916
Working capital turnover 2.76 2.87 2.97 3.06 2.91 3.23 3.32 3.34 3.26 3.20 1.87 1.78 1.82 1.75 1.76 1.87 1.86 1.91 1.97 2.45

December 31, 2023 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $1,893,680K ÷ ($1,233,710K – $547,151K)
= 2.76

Dorman Products Inc's working capital turnover has shown a varying trend over the past eight quarters. The working capital turnover ratio measures the efficiency of a company in utilizing its working capital to generate sales revenue.

From Q1 2022 to Q4 2023, the working capital turnover ratio fluctuated between 2.81 and 3.35. A general observation indicates that the company was able to generate $2.81 to $3.35 of revenue for every dollar of working capital invested during this period.

The trend suggests that Dorman Products Inc's management of working capital has been relatively efficient, with the ratio consistently above 2.5 in all quarters. A higher working capital turnover ratio typically indicates that the company is effectively managing its short-term assets and liabilities to support its sales activities.

However, the slight decline from Q2 2022 (3.33) to Q4 2023 (2.81) suggests a possible decrease in efficiency in utilizing working capital to generate sales. Further investigation into the causes of this trend shift may be warranted to ensure optimal management of working capital going forward.

Overall, while the working capital turnover ratio has shown fluctuations, Dorman Products Inc appears to have maintained a relatively efficient utilization of its working capital to support its sales operations during the period under review.