Paylocity Holdng (PCTY)

Working capital turnover

		Jun 30, 2025	Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021
Revenue	US$ in thousands	1,595,220	1,402,520	1,174,600	852,651	635,627
Total current assets	US$ in thousands	607,832	3,524,490	3,048,440	4,231,680	2,032,880
Total current liabilities	US$ in thousands	210,428	3,117,360	2,774,800	4,120,530	1,867,020
Working capital turnover		4.01	3.44	4.29	7.67	3.83

June 30, 2025 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $1,595,220K ÷ ($607,832K – $210,428K)
= 4.01

The working capital turnover ratio for Paylocity Holding demonstrates notable fluctuations over the observed periods. As of June 30, 2021, the ratio stood at 3.83, indicating that the company generated approximately 3.83 units of revenue for each dollar of working capital employed. This ratio significantly increased to 7.67 by June 30, 2022, representing a substantial improvement in efficiency and possibly enhanced operational effectiveness or better management of working capital resources during that period.

However, subsequent data indicates a decline, with the ratio decreasing to 4.29 by June 30, 2023, suggesting a reduction in the efficiency of utilizing working capital to generate revenue. This downward trend continued into the next fiscal year, with the ratio dropping to 3.44 as of June 30, 2024. A slight recovery is observed in the projected data for June 30, 2025, where the ratio increases again to 4.01, approaching the earlier levels observed in 2023.

Overall, the pattern illustrates periods of both improvement and decline in Paylocity Holding’s working capital efficiency, with a peak around mid-2022 followed by a decline and some stabilization. These fluctuations could be attributed to variations in operational management, revenue cycles, inventories, receivables, payables, or other working capital components affecting the company's ability to generate sales relative to its working capital base.