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.