Southwest Airlines Company (LUV)
Working capital turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 25,857,000 | 23,322,000 | 15,381,000 | 9,048,000 | 22,426,000 |
| Total current assets | US$ in thousands | 13,955,000 | 14,808,000 | 18,036,000 | 15,173,000 | 5,974,000 |
| Total current liabilities | US$ in thousands | 12,256,000 | 10,378,000 | 9,164,000 | 7,506,000 | 8,952,000 |
| Working capital turnover | 15.22 | 5.26 | 1.73 | 1.18 | — |
December 31, 2023 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $25,857,000K ÷ ($13,955,000K – $12,256,000K)
= 15.22
The working capital turnover ratio of Southwest Airlines Co has exhibited a positive trend over the past five years, indicating an improvement in the company's efficiency in utilizing its working capital. In particular, the ratio increased from 1.18 in 2020 to 15.36 in 2023, showcasing a substantial enhancement in the company's ability to generate revenue from its working capital. This signifies that Southwest Airlines Co has been able to efficiently utilize its current assets and liabilities to support its operational activities and generate sales. The significant increase in the working capital turnover ratio from 2020 to 2023 suggests improved management of the company's working capital and potentially better liquidity and profitability. Overall, the upward trend in the working capital turnover ratio reflects positively on Southwest Airlines Co's ability to effectively manage its working capital and generate revenue.
Peer comparison
Dec 31, 2023