Dorian LPG Ltd (LPG)
Working capital turnover
| Mar 31, 2024 | Mar 31, 2023 | Mar 31, 2022 | Mar 31, 2021 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 560,717 | 389,749 | 274,221 | 315,939 | 333,430 |
| Total current assets | US$ in thousands | 368,882 | 236,299 | 307,893 | 153,343 | 139,615 |
| Total current liabilities | US$ in thousands | 101,813 | 94,597 | 94,837 | 82,081 | 85,013 |
| Working capital turnover | 2.10 | 2.75 | 1.29 | 4.43 | 6.11 |
March 31, 2024 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $560,717K ÷ ($368,882K – $101,813K)
= 2.10
The working capital turnover ratio measures how efficiently a company is able to use its working capital to generate sales revenue. Dorian LPG Ltd's working capital turnover has fluctuated over the past five years, with a high of 6.11 in 2020 and a low of 1.29 in 2022.
In 2024, the working capital turnover ratio was 2.10, indicating that for every $1 of working capital, the company generated $2.10 in sales revenue. This represents a decrease from the previous year's ratio of 2.75. The decreasing trend in the ratio could suggest that the company's ability to efficiently utilize its working capital to drive sales has declined.
It is important to note that a higher working capital turnover ratio is generally viewed as a positive indicator of operational efficiency, as it suggests that the company is effectively managing its working capital to support its sales activities. Conversely, a lower ratio may indicate inefficiencies in working capital management or potential difficulties in generating sales revenue. Further analysis of Dorian LPG Ltd's financial statements and industry benchmarks would be necessary to fully assess the implications of the working capital turnover trend.