Old Dominion Freight Line Inc (ODFL)

Working capital turnover

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020
Revenue (ttm)	US$ in thousands	5,815,630	5,938,920	5,983,990	5,898,480	5,885,610	5,867,450	5,955,860	6,210,120	6,262,120	6,180,360	5,976,720	5,628,680	5,256,110	4,918,280	4,576,400	4,153,200	4,014,576	3,950,876	3,941,166	4,105,626
Total current assets	US$ in thousands	720,683	735,059	807,113	1,263,660	1,143,330	954,216	730,609	896,950	933,740	1,111,200	1,209,090	1,280,960	1,383,790	1,278,850	1,311,120	1,223,260	1,243,340	1,138,500	968,570	831,006
Total current liabilities	US$ in thousands	540,529	553,580	552,754	550,674	544,658	552,350	503,018	569,520	529,793	639,327	628,178	578,596	464,234	534,291	482,018	513,862	373,130	449,288	494,174	428,295
Working capital turnover		32.28	32.73	23.53	8.27	9.83	14.60	26.17	18.97	15.50	13.10	10.29	8.01	5.72	6.61	5.52	5.85	4.61	5.73	8.31	10.19

December 31, 2024 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $5,815,630K ÷ ($720,683K – $540,529K)
= 32.28

Old Dominion Freight Line Inc's working capital turnover has shown a fluctuating trend over the periods provided. The working capital turnover ratio measures how efficiently a company is utilizing its working capital to generate sales revenue. A higher working capital turnover ratio indicates better efficiency in managing working capital.

In the data provided, the working capital turnover ratio ranged from a low of 4.61 on December 31, 2020, to a high of 32.73 on September 30, 2024, showcasing a wide variation in efficiency over time. Generally, a decreasing trend in the working capital turnover ratio may suggest inefficiency in managing working capital, while an increasing trend may signal improved efficiency.

Specifically, there was a substantial increase in the working capital turnover ratio from March 31, 2023 (18.97) to June 30, 2023 (26.17), indicating a notable improvement in efficiency during this period. However, this trend was followed by a sharp decline to 14.60 on September 30, 2023, reflecting a potential issue in managing working capital during that quarter.

On an overall basis, monitoring the working capital turnover ratio can provide insights into Old Dominion Freight Line Inc's operational efficiency and effectiveness in utilizing its working capital resources to drive sales. Additionally, further analysis and comparison with industry benchmarks can provide a more comprehensive understanding of the company's working capital management performance.