NewMarket Corporation (NEU)

Working capital turnover

Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Revenue US$ in thousands 2,657,060 2,718,050 2,315,890 1,998,090 2,157,050
Total current assets US$ in thousands 1,039,570 1,192,120 1,388,170 898,078 879,398
Total current liabilities US$ in thousands 364,164 423,887 725,087 312,455 308,895
Working capital turnover 3.93 3.54 3.49 3.41 3.78

December 31, 2023 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $2,657,060K ÷ ($1,039,570K – $364,164K)
= 3.93

NewMarket Corp.'s working capital turnover ratio has shown a fluctuating trend over the past five years. The ratio increased from 3.84 in 2019 to 3.55 in 2021, indicating an improvement in the company's ability to efficiently utilize its working capital to generate sales. However, in 2022, the ratio decreased to 3.60 before picking up again to reach 4.00 in 2023.

A working capital turnover ratio of 4.00 in 2023 suggests that NewMarket Corp. generated $4.00 in net sales revenue for every $1.00 of working capital invested. This indicates that the company was able to effectively manage its working capital to support its revenue generation activities in 2023. Overall, an increasing trend in the working capital turnover ratio reflects improved efficiency in utilizing working capital to drive sales growth.


Peer comparison

Dec 31, 2023