Otter Tail Corporation (OTTR)

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 1,329,974 1,345,648 1,367,062 1,362,714 1,355,764 1,347,816 1,372,872 1,434,862 1,469,475 1,492,823 1,425,261 1,310,829 1,197,635 1,083,525 1,002,986 910,134 883,171 878,934 871,831 908,278
Total current assets US$ in thousands 630,041 650,313 614,128 607,943 570,170 556,750 524,112 454,365 452,752 460,493 471,389 402,391 369,354 334,967 304,901 258,963 234,832 274,916 266,923 256,184
Total current liabilities US$ in thousands 309,790 299,590 270,952 208,474 309,757 310,033 300,562 262,464 237,636 241,853 288,153 373,155 387,699 510,087 483,484 459,429 436,786 299,736 232,923 175,688
Working capital turnover 4.15 3.84 3.98 3.41 5.21 5.46 6.14 7.48 6.83 6.83 7.78 44.84 — — — — — — 25.64 11.28

December 31, 2024 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $1,329,974K ÷ ($630,041K – $309,790K)
= 4.15

Working capital turnover is a financial ratio that measures how efficiently a company utilizes its working capital to generate sales revenue. A high working capital turnover indicates that the company is effectively managing its working capital resources to support sales activities.

For Otter Tail Corporation, the working capital turnover has fluctuated over the years. In March 2020, the ratio was 11.28, indicating that for every dollar of working capital, the company generated $11.28 in sales. The ratio saw a significant increase to 25.64 in June 2020, suggesting an improvement in efficiency during that period.

However, the ratio was not available for September and December 2020, indicating possibly missing or incomplete data. As of March 2021, the ratio was still unavailable. In June 2021, the working capital turnover ratio was again unavailable.

Moving forward, the working capital turnover ratio was notably high at 44.84 in March 2022, signifying a substantial improvement in efficiency. By June 2022, the ratio declined to 7.78, which may indicate a lower level of efficiency in utilizing working capital compared to the previous quarter.

Subsequently, the ratio continued to decrease to 3.41 in March 2024, indicating a potential decline in efficiency in utilizing working capital to generate sales. The ratio slightly increased to 3.98 in June 2024, but it remained at a relatively low level compared to previous periods.

Overall, fluctuations in the working capital turnover ratio for Otter Tail Corporation suggest varying levels of efficiency in managing working capital to support sales activities over the reported periods, highlighting the importance of monitoring this ratio to assess operational effectiveness and financial performance.