Mativ Holdings Inc. (MATV)
Working capital turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 1,959,100 | 2,091,700 | 1,421,900 | 1,043,000 | 985,300 |
| Total current assets | US$ in thousands | 712,500 | 974,700 | 594,600 | 396,400 | 427,500 |
| Total current liabilities | US$ in thousands | 281,400 | 466,200 | 231,100 | 166,900 | 157,600 |
| Working capital turnover | 4.54 | 4.11 | 3.91 | 4.54 | 3.65 |
December 31, 2023 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $1,959,100K ÷ ($712,500K – $281,400K)
= 4.54
Mativ Holdings Inc's working capital turnover has exhibited a generally positive trend over the past five years. The ratio increased from 3.79 in 2019 to 4.70 in 2023, indicating an improvement in the efficiency of the company's working capital management. This implies that the company is able to generate $4.70 in revenue for each dollar of working capital invested in the business in 2023, compared to $3.79 in 2019.
A higher working capital turnover ratio signifies that the company is efficiently utilizing its current assets to generate sales, which could be indicative of effective inventory management, accounts receivable collection, and accounts payable management.
However, it is important to note that a very high working capital turnover ratio may also indicate that the company is struggling to maintain sufficient levels of working capital to support its operations. Therefore, while the increasing trend in the working capital turnover ratio for Mativ Holdings Inc is generally positive, it is essential to assess this ratio in conjunction with other financial metrics to gain a comprehensive understanding of the company's financial performance and liquidity position.
Peer comparison
Dec 31, 2023