Simply Good Foods Co (SMPL)

Working capital turnover

		Aug 31, 2024	May 25, 2024	Feb 24, 2024	Nov 25, 2023	Aug 26, 2023	May 27, 2023	Feb 25, 2023	Nov 26, 2022	Aug 27, 2022	May 28, 2022	Feb 26, 2022	Nov 27, 2021	Aug 28, 2021	May 29, 2021	Feb 27, 2021	Nov 28, 2020	Aug 29, 2020	May 30, 2020	Feb 29, 2020	Nov 30, 2019
Revenue (ttm)	US$ in thousands	1,331,588	1,252,300	1,239,906	1,221,199	1,212,260	1,167,626	1,162,029	1,166,378	1,146,988	1,130,420	1,094,438	1,025,803	974,051	944,406	883,763	887,277	816,641	733,539	657,906	554,605
Total current assets	US$ in thousands	440,280	481,351	435,842	396,539	371,652	349,810	359,643	357,300	351,601	366,724	335,989	287,637	298,666	309,621	289,134	278,953	260,263	281,140	235,634	252,640
Total current liabilities	US$ in thousands	108,615	92,701	103,661	78,989	89,857	71,275	80,403	80,914	102,248	120,287	107,655	80,765	113,664	97,960	80,560	75,376	71,478	87,770	74,289	94,731
Working capital turnover		4.01	3.22	3.73	3.85	4.30	4.19	4.16	4.22	4.60	4.59	4.79	4.96	5.27	4.46	4.24	4.36	4.33	3.79	4.08	3.51

August 31, 2024 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $1,331,588K ÷ ($440,280K – $108,615K)
= 4.01

The working capital turnover ratio for Simply Good Foods Co has shown fluctuation over the past few quarters, ranging from a low of 3.22 to a high of 5.27. This ratio measures the efficiency with which the company is utilizing its working capital to generate revenue. A higher ratio indicates that the company is effectively utilizing its working capital to generate sales.

The average working capital turnover over the period analyzed is approximately 4.26, indicating that, on average, Simply Good Foods Co is turning over its working capital 4.26 times a year. This suggests that the company is efficiently managing its working capital to support its operations and generate sales.

It is important to note that a high or increasing working capital turnover ratio may also indicate aggressive management of working capital, which could potentially lead to liquidity issues if not managed carefully. Conversely, a low or decreasing ratio may suggest inefficiencies in managing working capital.

Overall, Simply Good Foods Co appears to be effectively managing its working capital to support its operational activities and generate sales, as evidenced by the average working capital turnover ratio of 4.26.