Mattel Inc (MAT)

Working capital turnover

Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Revenue US$ in thousands 5,379,550 5,441,200 5,434,700 5,457,700 4,583,700
Total current assets US$ in thousands 3,126,920 3,122,350 2,729,000 2,874,500 2,482,900
Total current liabilities US$ in thousands 1,315,720 1,342,480 1,187,700 1,598,300 1,355,400
Working capital turnover 2.97 3.06 3.53 4.28 4.07

December 31, 2024 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $5,379,550K ÷ ($3,126,920K – $1,315,720K)
= 2.97

The working capital turnover ratio indicates how efficiently a company is utilizing its working capital to generate sales. In the case of Mattel Inc, the working capital turnover has fluctuated over the past five years.

In December 2020, Mattel had a working capital turnover of 4.07, which increased slightly to 4.28 by December 2021, suggesting an improvement in the efficiency of working capital utilization. However, in December 2022, the ratio decreased to 3.53, indicating a potential decrease in sales generated per unit of working capital.

Further decline was observed in December 2023, with a working capital turnover of 3.06, and in December 2024, the ratio dropped to 2.97. These decreases may signal challenges in effectively managing working capital to support revenue generation.

Overall, the trend in Mattel's working capital turnover suggests some variability in how efficiently the company is converting its working capital into sales over the specified period. This may warrant a closer examination of the company's working capital management practices and potential strategies to improve efficiency.