LyondellBasell Industries NV (LYB)
Working capital turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 41,107,000 | 50,451,000 | 46,173,000 | 27,753,000 | 34,727,000 |
| Total current assets | US$ in thousands | 13,152,000 | 11,845,000 | 12,217,000 | 11,634,000 | 9,510,000 |
| Total current liabilities | US$ in thousands | 7,150,000 | 6,760,000 | 7,230,000 | 5,502,000 | 5,198,000 |
| Working capital turnover | 6.85 | 9.92 | 9.26 | 4.53 | 8.05 |
December 31, 2023 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $41,107,000K ÷ ($13,152,000K – $7,150,000K)
= 6.85
The working capital turnover ratio of LyondellBasell Industries NV has exhibited fluctuating trends over the past five years. In 2023, the company's working capital turnover stood at 6.85, reflecting a decrease compared to the previous year, where it was significantly higher at 9.92. This decrease indicates that the company might be less efficient in utilizing its working capital to generate revenue in 2023.
However, when looking at the longer-term trend, the working capital turnover ratio has generally been healthy and above 1, signaling that LyondellBasell is effectively utilizing its working capital to generate sales. Comparing the current ratio to the levels in 2021, 2020, and 2019, the efficiency in utilizing working capital has shown variations, with the company experiencing a peak in effectiveness in 2022 with a ratio of 9.92.
It is important for the company to continuously monitor and manage its working capital turnover ratio to ensure efficient utilization of resources and maximize profitability. Further analysis is required to understand the factors contributing to the fluctuations in the working capital turnover ratio and identify opportunities for improvement in working capital management.
Peer comparison
Dec 31, 2023