Iridium Communications Inc (IRDM)
Working capital turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 790,723 | 721,034 | 614,500 | 583,439 | 560,444 |
| Total current assets | US$ in thousands | 271,084 | 306,204 | 424,410 | 347,821 | 342,935 |
| Total current liabilities | US$ in thousands | 131,554 | 141,577 | 108,836 | 113,072 | 113,751 |
| Working capital turnover | 5.67 | 4.38 | 1.95 | 2.49 | 2.45 |
December 31, 2023 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $790,723K ÷ ($271,084K – $131,554K)
= 5.67
Based on the data provided for Iridium Communications Inc, the working capital turnover has shown an increasing trend over the past five years. The working capital turnover ratio measures how efficiently a company is utilizing its working capital to generate sales revenue. A higher working capital turnover ratio indicates that the company is effectively managing its working capital to support its sales operations.
In 2023, the working capital turnover ratio was 5.67, reflecting a significant improvement from the previous year. This suggests that Iridium Communications Inc has improved its efficiency in converting its working capital into sales revenue. The increase in the ratio may be attributed to better management of inventory, receivables, and payables to support the company's operations.
Comparing the ratios from 2021 to 2023, there has been a notable enhancement in the company's working capital turnover, indicating an improvement in operational efficiency. However, it is essential to continue monitoring this ratio to ensure sustained efficiency in managing working capital.
Overall, the increasing trend in Iridium Communications Inc's working capital turnover ratio signifies the company's ability to efficiently utilize its working capital resources to drive sales growth and operational performance.
Peer comparison
Dec 31, 2023