Timken Company (TKR)
Working capital turnover
| 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 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (ttm) | US$ in thousands | 4,692,900 | 4,683,700 | 4,685,600 | 4,577,000 | 4,444,200 | 4,369,500 | 4,274,900 | 4,187,100 | 4,087,600 | 3,972,000 | 3,827,800 | 3,564,800 | 3,459,700 | 3,464,200 | 3,481,700 | 3,677,800 | 3,736,200 | 3,750,100 | 3,723,100 | 3,638,000 |
| Total current assets | US$ in thousands | 2,634,900 | 2,606,900 | 2,710,800 | 2,592,300 | 2,504,000 | 2,453,500 | 2,480,400 | 2,548,300 | 2,213,500 | 2,195,400 | 2,195,000 | 2,143,600 | 2,000,300 | 1,964,500 | 2,006,900 | 2,092,200 | 1,874,600 | 1,807,400 | 1,866,700 | 1,919,600 |
| Total current liabilities | US$ in thousands | 1,471,300 | 1,503,900 | 1,022,400 | 940,000 | 1,012,400 | 1,209,000 | 920,500 | 866,200 | 896,600 | 846,000 | 857,300 | 916,800 | 848,000 | 740,400 | 664,800 | 769,800 | 736,600 | 704,600 | 696,300 | 683,600 |
| Working capital turnover | 4.03 | 4.25 | 2.78 | 2.77 | 2.98 | 3.51 | 2.74 | 2.49 | 3.10 | 2.94 | 2.86 | 2.91 | 3.00 | 2.83 | 2.59 | 2.78 | 3.28 | 3.40 | 3.18 | 2.94 |
December 31, 2023 calculation
Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $4,692,900K ÷ ($2,634,900K – $1,471,300K)
= 4.03
The working capital turnover for Timken Co. has shown some fluctuations over the past eight quarters. The working capital turnover ratio measures how efficiently a company is utilizing its working capital to generate sales revenue. A higher ratio indicates that the company is effectively managing its working capital.
In Q4 2023 and Q3 2023, the working capital turnover ratios were 4.10 and 4.32 respectively, which are relatively high compared to the previous quarters. This suggests that Timken Co. was able to generate $4.10 and $4.32 of sales for every dollar of working capital invested during these periods.
In contrast, Q2 2023 and Q1 2023 saw a decline in the working capital turnover ratio to 2.82 and 2.81 respectively, indicating a decrease in efficiency in utilizing working capital to generate sales revenue during those quarters.
Comparing the most recent data with the same period in the previous year, Q4 2023's ratio of 4.10 is higher than Q4 2022's ratio of 3.01, showing an improvement in working capital efficiency year over year.
Overall, while there have been fluctuations in the working capital turnover ratio for Timken Co. over the past eight quarters, the company has shown periods of improved efficiency in utilizing working capital to generate sales revenue, which is a positive indicator of its operational performance.
Peer comparison
Dec 31, 2023