Heritage Financial Corporation (HFWA)
Working capital turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 309,712 | 239,538 | 248,976 | 240,404 | 238,226 |
| Total current assets | US$ in thousands | 5,592,350 | 1,209,720 | 1,453,580 | 2,632,280 | 1,564,900 |
| Total current liabilities | US$ in thousands | — | 142,542 | 5,315,490 | 5,453,400 | 4,698,960 |
| Working capital turnover | 0.06 | 0.22 | — | — | — |
December 31, 2024 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $309,712K ÷ ($5,592,350K – $—K)
= 0.06
Based on the data provided, Heritage Financial Corporation's working capital turnover has shown a fluctuating trend over the years. The working capital turnover ratio represents how efficiently the company utilizes its working capital to generate sales revenue.
In 2023, the working capital turnover ratio was 0.22, indicating that the company generated $0.22 in sales revenue for every dollar of working capital invested. This suggests a relatively efficient utilization of working capital to generate sales.
However, the ratio declined significantly to 0.06 in 2024, which may indicate a potential decrease in efficiency in using working capital to generate sales revenue. This sharp decline could be a cause for concern, as it may point to challenges in managing working capital effectively or a decline in revenue generation relative to the amount of working capital employed.
Overall, Heritage Financial Corporation should closely monitor its working capital turnover ratio and take appropriate measures to improve efficiency in utilizing working capital to drive sales growth and profitability.