Smurfit WestRock plc (SW)
Working capital turnover
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Dec 31, 2022 | Jun 30, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (ttm) | US$ in thousands | 23,877,500 | 21,680,480 | 16,924,480 | 17,290,730 | 21,079,510 | 22,711,780 | 26,096,490 | 25,427,580 | 24,019,550 | 21,674,780 |
| Total current assets | US$ in thousands | 10,055,000 | 10,545,000 | 25 | 0 | 4,081,000 | — | 4,210,000 | 4,509,000 | — | — |
| Total current liabilities | US$ in thousands | 7,333,000 | 7,126,000 | 11 | — | 2,694,000 | — | 2,678,000 | 3,027,000 | — | — |
| Working capital turnover | 8.77 | 6.34 | 1,208,891.43 | — | 15.20 | — | 17.03 | 17.16 | — | — |
December 31, 2024 calculation
Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $23,877,500K ÷ ($10,055,000K – $7,333,000K)
= 8.77
The working capital turnover ratio measures how effectively a company is utilizing its working capital to generate sales revenue. In the case of Smurfit WestRock plc:
1. As of December 31, 2022, the working capital turnover ratio was 17.16, implying that for every $1 of working capital, the company generated $17.16 in sales revenue during the period.
2. The ratio remained relatively stable as of June 30, 2023, at 17.03, indicating continued efficiency in utilizing working capital to drive sales.
3. However, there was a significant drop in the ratio to 15.20 as of December 31, 2023, which may suggest a slight decrease in the efficiency of working capital management in generating sales.
4. The ratio saw a substantial increase to 1,208,891.43 as of June 30, 2024, which could be a result of significant fluctuations in either working capital or sales figures, potentially indicating anomalous data.
5. Subsequently, the ratio dropped drastically to 6.34 as of September 30, 2024, implying a sharp decline in the efficiency of working capital utilization to generate sales.
6. As of December 31, 2024, the ratio improved to 8.77, but it still remained significantly below the previous levels seen in 2022 and early 2023.
In summary, Smurfit WestRock plc's working capital turnover ratio has shown fluctuations over the analyzed periods, suggesting varying levels of efficiency in using working capital to drive sales revenue. It is important for the company to closely monitor and manage its working capital to ensure optimal performance and sustainable growth.
Peer comparison
Dec 31, 2024