Nabors Industries Ltd (NBR)
Working capital turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 2,849,710 | 2,370,550 | 2,472,160 | 2,597,540 | 3,502,510 |
| Total current assets | US$ in thousands | 1,645,680 | 1,000,620 | 1,501,810 | 1,131,460 | 1,248,670 |
| Total current liabilities | US$ in thousands | 1,213,980 | 596,390 | 525,228 | 515,469 | 656,548 |
| Working capital turnover | 6.60 | 5.86 | 2.53 | 4.22 | 5.92 |
December 31, 2023 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $2,849,710K ÷ ($1,645,680K – $1,213,980K)
= 6.60
The working capital turnover ratio for Nabors Industries Ltd has exhibited fluctuations over the past five years. The ratio measures how efficiently the company is utilizing its working capital to generate sales. A higher ratio indicates better efficiency in using working capital.
In 2023, the working capital turnover ratio improved to 6.96 from 6.57 in 2022, which suggests that the company was able to generate more sales with its working capital during the year. This could be due to effective management of current assets and liabilities.
The significant increase in the ratio in 2021 (2.03) compared to the previous year could indicate either a decrease in sales relative to working capital or inefficiencies in managing working capital during that period. However, the ratio improved in 2022 and 2023, reflecting a better utilization of working capital for generating sales.
Overall, despite fluctuations, the trend suggests that Nabors Industries Ltd has been able to enhance its operational efficiency in utilizing working capital for sales generation over the past five years. It is essential for the company to maintain this positive trend to ensure sustainable growth and profitability in the future.
Peer comparison
Dec 31, 2023