IPG Photonics Corporation (IPGP)

Working capital turnover

Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Revenue US$ in thousands 1,287,440 1,429,550 1,460,860 1,200,720 1,314,580
Total current assets US$ in thousands 1,914,650 1,986,270 2,347,680 2,148,080 1,896,630
Total current liabilities US$ in thousands 214,861 274,646 313,433 214,578 191,904
Working capital turnover 0.76 0.84 0.72 0.62 0.77

December 31, 2023 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $1,287,440K ÷ ($1,914,650K – $214,861K)
= 0.76

The working capital turnover ratio for IPG Photonics Corp has fluctuated over the past five years, ranging from a low of 0.62 in 2020 to a high of 0.84 in 2022. This ratio indicates how efficiently the company is utilizing its working capital to generate sales revenue. A higher ratio generally suggests better efficiency in utilizing working capital to support sales activities.

In 2023, the working capital turnover ratio decreased to 0.76 from the previous year's 0.84. This decrease may suggest that the company was slightly less efficient in managing its working capital to generate sales revenue compared to the prior year. However, it is important to note that the ratio is still above 1, indicating that IPG Photonics Corp is effectively using its working capital to support its sales operations.

Overall, while there has been some variability in the working capital turnover ratio over the years, IPG Photonics Corp appears to have maintained a relatively stable level of efficiency in utilizing its working capital to drive sales revenue across the years analyzed.