Hilton Grand Vacations Inc (HGV)
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 | 3,978,000 | 3,951,000 | 4,049,000 | 3,990,000 | 3,835,000 | 3,681,000 | 3,493,000 | 2,879,000 | 2,335,000 | 1,709,000 | 989,000 | 778,000 | 894,000 | 1,150,000 | 1,408,000 | 1,739,000 | 1,838,000 | 2,012,000 | 1,973,000 | 2,082,000 |
| Total current assets | US$ in thousands | 3,552,000 | 2,797,000 | 737,000 | 892,000 | 734,000 | 823,000 | 787,000 | 961,000 | 734,000 | 612,000 | 538,000 | 511,000 | 547,000 | 734,000 | 1,107,000 | 827,000 | 241,000 | 250,000 | 120,000 | 158,000 |
| Total current liabilities | US$ in thousands | 1,151,000 | 1,356,000 | 1,481,000 | 1,567,000 | 1,197,000 | 118,000 | 142,000 | 159,000 | 112,000 | 170,000 | 824,000 | 710,000 | 16,000 | 644,000 | 621,000 | 662,000 | 599,000 | 620,000 | 583,000 | 527,000 |
| Working capital turnover | 1.66 | 2.74 | — | — | — | 5.22 | 5.42 | 3.59 | 3.75 | 3.87 | — | — | 1.68 | 12.78 | 2.90 | 10.54 | — | — | — | — |
December 31, 2023 calculation
Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $3,978,000K ÷ ($3,552,000K – $1,151,000K)
= 1.66
The working capital turnover ratio measures how efficiently a company utilizes its working capital to generate sales revenue. It is calculated by dividing net sales by average working capital. A higher ratio indicates more efficient utilization of working capital.
Analyzing the working capital turnover ratios of Hilton Grand Vacations Inc over the past eight quarters, we observe fluctuations in the ratio. In Q2 and Q3 of 2023, the working capital turnover ratio increased to 1.39 and 1.33, respectively, indicating improved efficiency in converting working capital into revenue. This trend suggests that the company managed its working capital more effectively during these quarters.
Conversely, in Q1 and Q4 of 2023, the working capital turnover ratios declined to 1.31 and 1.05, respectively. These lower ratios may indicate a decreased ability to generate sales revenue from working capital during these periods.
Comparing the quarterly ratios to the same quarter in the prior year, we note variations in performance. For example, the working capital turnover ratio in Q4 2023 decreased from Q4 2022, while it increased in Q2 and Q3 2023 compared to the same quarters in 2022.
Overall, the fluctuations in Hilton Grand Vacations Inc's working capital turnover ratio suggest varying levels of efficiency in utilizing working capital to generate sales revenue over the analyzed period. Further analysis of the underlying factors driving these fluctuations would provide valuable insights into the company's working capital management practices and operational performance.