Sterling Construction Company Inc (STRL)
Working capital turnover
| Mar 31, 2025 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (ttm) | US$ in thousands | 2,106,345 | 2,115,756 | 2,102,901 | 2,069,507 | 2,009,010 | 1,972,229 | 1,934,858 | 1,931,453 | 1,919,696 | 1,926,437 | 1,879,165 | 1,785,672 | 1,676,770 | 1,581,766 | 1,527,659 | 1,447,668 | 1,446,040 | 1,427,412 | 1,426,728 | 1,334,969 |
| Total current assets | US$ in thousands | 997,734 | 1,021,880 | 1,083,640 | 1,016,770 | 878,858 | 847,979 | 875,964 | 715,800 | 587,960 | 597,254 | 669,558 | 537,496 | 435,890 | 434,691 | 466,022 | 434,092 | 355,229 | 361,543 | 427,218 | 416,447 |
| Total current liabilities | US$ in thousands | 756,769 | 741,958 | 839,036 | 820,856 | 705,717 | 678,168 | 685,837 | 567,765 | 444,689 | 446,611 | 512,308 | 407,389 | 339,514 | 351,760 | 357,724 | 346,242 | 322,246 | 321,884 | 357,369 | 337,692 |
| Working capital turnover | 8.74 | 7.56 | 8.60 | 10.56 | 11.60 | 11.61 | 10.18 | 13.05 | 13.40 | 12.79 | 11.95 | 13.72 | 17.40 | 19.07 | 14.11 | 16.48 | 43.84 | 35.99 | 20.43 | 16.95 |
March 31, 2025 calculation
Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $2,106,345K ÷ ($997,734K – $756,769K)
= 8.74
The working capital turnover ratio for Sterling Construction Company Inc. has experienced notable fluctuations over the specified periods. As of June 30, 2020, the ratio stood at 16.95, indicating a moderate efficiency in utilizing working capital to generate sales. This ratio increased significantly by September 30, 2020, reaching 20.43, and further surged to 35.99 by the end of 2020, reflecting an improved capacity to generate sales relative to working capital employed.
Throughout 2021, the ratio maintained elevated levels, peaking at 43.84 on March 31, illustrating a period of heightened operational efficiency or increased sales relative to working capital. However, following this peak, the ratio declined markedly to 16.48 by June 30, 2021, and continued downward trend persisted into 2022 and 2023, with ratios falling to as low as approximately 10.18 on September 30, 2023. These declines suggest a reduction in the efficiency with which working capital is being used to generate sales, potentially signaling operational challenges, changes in working capital management, or shifts in sales volume.
In the most recent periods, the ratio remains relatively low, at roughly 8.60 on September 30, 2024, and slightly rebounding to 8.74 as of March 31, 2025. This sustained lower level indicates that the company is generating less sales per unit of working capital compared to previous years, which may raise concerns about declining operational efficiency or changes in business strategy.
Overall, the trend depicts a significant decline in working capital turnover from its peak in early 2021, with subsequent periods showing persistently lower ratios. This pattern warrants further investigation into underlying causes such as changes in sales volume, working capital management practices, or operational scale, to understand the implications for the company's liquidity and operational performance.
Peer comparison
Mar 31, 2025