Healthcare Services Group Inc (HCSG)
Working capital turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 1,664,880 | 1,690,840 | 1,641,960 | 1,760,300 | 1,837,420 |
| Total current assets | US$ in thousands | 571,696 | 508,632 | 546,382 | 572,403 | 515,732 |
| Total current liabilities | US$ in thousands | 216,928 | 189,014 | 191,125 | 162,260 | 148,651 |
| Working capital turnover | 4.69 | 5.29 | 4.62 | 4.29 | 5.01 |
December 31, 2023 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $1,664,880K ÷ ($571,696K – $216,928K)
= 4.69
The working capital turnover for Healthcare Services Group, Inc. has fluctuated over the past five years. The ratio indicates how efficiently the company is utilizing its working capital to generate revenue. A higher working capital turnover ratio is generally seen as favorable as it suggests that the company is effectively utilizing its current assets to support its operations.
In this case, we see that the working capital turnover ratio was highest in 2022 at 5.12 and lowest in 2020 at 4.29. The fluctuations in the ratio may be indicative of changes in the company's operating efficiency or the management of its working capital.
Overall, the company has shown a relatively strong working capital turnover ratio over the years, which implies that Healthcare Services Group, Inc. has been effectively managing its working capital to support its revenue generation activities. This consistent performance in utilizing working capital efficiently is a positive indicator of the company's operational effectiveness.