Federal Signal Corporation (FSS)

Working capital turnover

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Revenue	US$ in thousands	1,861,500	1,722,700	1,434,800	1,213,200	1,130,800
Total current assets	US$ in thousands	642,500	570,200	531,400	431,000	405,500
Total current liabilities	US$ in thousands	241,800	195,800	180,500	170,400	148,400
Working capital turnover		4.65	4.60	4.09	4.66	4.40

December 31, 2024 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $1,861,500K ÷ ($642,500K – $241,800K)
= 4.65

The working capital turnover for Federal Signal Corporation has shown a relatively stable trend over the past five years. The ratio has fluctuated within a narrow range, averaging approximately 4.48. This indicates that, on average, the company generated $4.48 in revenue for every dollar of working capital invested during the period.

The slight variations in the working capital turnover ratio suggest that Federal Signal Corporation has been effectively managing its working capital to support its revenue generation activities. A higher turnover ratio typically signifies a more efficient utilization of working capital in generating sales, implying that the company is efficiently converting its current assets into revenue.

Overall, the stable and relatively high working capital turnover ratio for Federal Signal Corporation indicates efficient working capital management and a strong ability to generate revenue relative to its working capital investment over the period analyzed.