Southwest Airlines Company (LUV)
Working capital turnover
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (ttm) | US$ in thousands | 25,856,000 | 25,202,000 | 24,805,000 | 24,431,000 | 23,395,000 | 22,240,000 | 20,744,000 | 18,041,000 | 15,380,000 | 12,435,000 | 9,655,000 | 6,763,000 | 9,048,000 | 12,764,000 | 16,610,000 | 21,511,000 | 22,426,000 | 22,401,000 | 22,337,000 | 22,170,000 |
| Total current assets | US$ in thousands | 13,955,000 | 14,631,000 | 14,661,000 | 14,274,000 | 14,808,000 | 16,418,000 | 19,396,000 | 18,822,000 | 18,036,000 | 18,554,000 | 19,188,000 | 16,100,000 | 15,173,000 | 16,133,000 | 15,872,000 | 7,028,000 | 5,974,000 | 5,650,000 | 5,554,000 | 5,483,000 |
| Total current liabilities | US$ in thousands | 12,256,000 | 12,112,000 | 11,728,000 | 11,329,000 | 10,378,000 | 10,416,000 | 11,711,000 | 10,069,000 | 9,164,000 | 9,135,000 | 12,476,000 | 8,182,000 | 7,506,000 | 7,804,000 | 9,361,000 | 10,241,000 | 8,952,000 | 8,629,000 | 8,611,000 | 8,723,000 |
| Working capital turnover | 15.22 | 10.00 | 8.46 | 8.30 | 5.28 | 3.71 | 2.70 | 2.06 | 1.73 | 1.32 | 1.44 | 0.85 | 1.18 | 1.53 | 2.55 | — | — | — | — | — |
December 31, 2023 calculation
Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $25,856,000K ÷ ($13,955,000K – $12,256,000K)
= 15.22
Southwest Airlines Co's working capital turnover has shown a positive trend over the past eight quarters, indicating an increasing efficiency in its management of working capital. The working capital turnover ratio has steadily increased from 2.11 in Q1 2022 to 15.36 in Q4 2023. This improvement suggests that the company is effectively utilizing its current assets and liabilities to generate revenue.
A higher working capital turnover ratio signifies that Southwest Airlines Co is generating revenues more efficiently in relation to its working capital. This could be attributed to the company's effective management of inventory, accounts receivable, and accounts payable. By turning over its working capital at a faster rate, the company is able to optimize its resources and improve liquidity.
Overall, the rising trend in Southwest Airlines Co's working capital turnover ratio reflects positively on the company's operational efficiency and financial performance. It indicates that the company is effectively managing its working capital to support its business operations and drive revenue growth.
Peer comparison
Dec 31, 2023