RPC Inc (RES)

Working capital turnover

Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Revenue US$ in thousands 1,627,900 1,610,970 874,713 607,747 1,225,850
Total current assets US$ in thousands 727,073 703,341 492,010 428,359 436,858
Total current liabilities US$ in thousands 151,857 178,603 130,849 79,565 101,402
Working capital turnover 2.83 3.07 2.42 1.74 3.65

December 31, 2023 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $1,627,900K ÷ ($727,073K – $151,857K)
= 2.83

The working capital turnover ratio indicates how efficiently a company is utilizing its working capital to generate sales revenue. A higher ratio suggests effective management of assets and liabilities.

In the case of RPC, Inc., the working capital turnover has fluctuated over the past five years. In 2023, the ratio stood at 2.81, slightly lower than the previous year's 3.05. This implies that for each dollar of working capital, RPC generated $2.81 in sales revenue in 2023.

Compared to 2021 and 2020, the working capital turnover has improved significantly, indicating better utilization of working capital to drive sales. However, it is worth noting that the ratio in 2023 is still lower than the peak seen in 2019 when it reached 3.64.

Overall, while there has been some variability in the working capital turnover ratio for RPC, Inc., the company has demonstrated an ability to efficiently convert its working capital into sales, albeit with some fluctuations in performance over the past five years.