Hillenbrand Inc (HI)
Working capital turnover
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 2,826,000 | 2,315,300 | 2,241,400 | 2,517,000 | 1,807,300 |
| Total current assets | US$ in thousands | 1,607,600 | 1,402,900 | 1,434,500 | 1,369,700 | 1,023,200 |
| Total current liabilities | US$ in thousands | 1,291,000 | 1,077,800 | 1,035,100 | 852,100 | 589,300 |
| Working capital turnover | 8.93 | 7.12 | 5.61 | 4.86 | 4.17 |
September 30, 2023 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $2,826,000K ÷ ($1,607,600K – $1,291,000K)
= 8.93
The working capital turnover ratio measures how effectively a company is using its working capital to generate sales. A higher ratio indicates efficient utilization of working capital.
Looking at the data for Hillenbrand Inc, we observe a consistent improvement in the working capital turnover ratio over the past five years. In 2019, the ratio stood at 4.17, and it has since shown an upward trend, reaching 8.93 in 2023. This indicates that the company's efficiency in utilizing its working capital to generate sales has improved significantly over this period.
The increasing trend in the working capital turnover ratio suggests that Hillenbrand Inc has been able to generate more revenue relative to its working capital, which can be attributed to effective management of its current assets and liabilities. This improved efficiency may be a result of enhanced inventory management, more efficient accounts receivable collection, or better management of accounts payable.
Overall, the rising trend in the working capital turnover ratio reflects positively on Hillenbrand Inc's ability to optimize its working capital, indicating improved operational efficiency and potentially better financial performance.
Peer comparison
Sep 30, 2023