WW Grainger Inc (GWW)

Working capital turnover

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 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
Revenue (ttm) US$ in thousands 17,168,000 16,932,000 16,752,000 16,622,000 16,478,000 16,283,000 16,017,000 15,672,000 15,228,000 14,785,000 14,215,000 13,585,000 13,022,000 12,604,000 12,250,000 11,880,000 11,797,000 11,703,000 11,632,000 11,688,000
Total current assets US$ in thousands 5,737,000 6,183,000 5,521,000 5,540,000 5,274,000 5,412,000 5,343,000 5,190,000 4,977,000 4,686,000 4,513,000 4,439,000 4,011,000 4,005,000 4,057,000 3,934,000 3,919,000 4,273,000 4,918,000 4,914,000
Total current liabilities US$ in thousands 2,305,000 2,383,000 2,397,000 2,528,000 1,831,000 1,898,000 1,920,000 1,924,000 2,010,000 1,785,000 1,750,000 1,742,000 1,528,000 1,550,000 1,589,000 1,531,000 1,441,000 1,441,000 1,388,000 1,500,000
Working capital turnover 5.00 4.46 5.36 5.52 4.79 4.63 4.68 4.80 5.13 5.10 5.14 5.04 5.24 5.13 4.96 4.94 4.76 4.13 3.30 3.42

December 31, 2024 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $17,168,000K ÷ ($5,737,000K – $2,305,000K)
= 5.00

WW Grainger Inc's working capital turnover has shown a fluctuating trend over the past few years. The ratio measures the efficiency of the company in generating sales revenue from its working capital. A higher working capital turnover indicates better utilization of working capital in generating sales.

From March 31, 2020, to December 31, 2020, there was a steady increase in the working capital turnover from 3.42 to 4.76, indicating an improvement in efficiency in utilizing working capital to generate sales revenue. This trend continued through June 30, 2021, reaching 4.96. The ratio peaked at 5.24 on December 31, 2021, reflecting the company's ability to effectively convert working capital into sales.

However, from March 31, 2022, to September 30, 2024, the working capital turnover witnessed some fluctuations, ranging from 4.80 to 5.52, before declining to 5.00 on December 31, 2024. The decrease in the ratio towards the end of the period may suggest some inefficiencies in the company's working capital management in converting it into sales.

Overall, WW Grainger Inc's working capital turnover has generally shown an increasing trend over the years, indicating improved efficiency in utilizing working capital. However, the fluctuations in the ratio towards the later part of the period may warrant further investigation into the company's working capital management practices.