Texas Pacific Land Trust (TPL)
Working capital turnover
| 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (ttm) | US$ in thousands | 659,375 | 631,595 | 617,644 | 650,788 | 666,449 | 667,422 | 661,894 | 594,476 | 514,138 | 450,958 | 378,084 | |||
| Total current assets | US$ in thousands | 963,828 | 862,464 | 790,858 | 737,530 | 711,006 | 633,401 | 589,187 | 523,936 | 618,840 | 526,513 | 458,108 | 398,230 | 375,847 | 332,530 |
| Total current liabilities | US$ in thousands | 70,871 | 44,387 | 47,370 | 44,884 | 61,037 | 39,595 | 43,599 | 57,073 | 67,279 | 50,900 | 29,102 | 21,810 | 33,848 | 21,376 |
| Working capital turnover | 0.74 | 0.77 | 0.83 | 0.94 | 1.03 | 1.12 | 1.21 | 1.27 | 0.93 | 0.95 | 0.88 |
March 31, 2024 calculation
Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $659,375K ÷ ($963,828K – $70,871K)
= 0.74
The working capital turnover for Texas Pacific Land Trust has exhibited some fluctuation over the past few quarters. The ratio indicates how efficiently the company is utilizing its working capital to generate revenue. A decreasing trend in the working capital turnover may suggest that the company is becoming less efficient in utilizing its current assets to support its operations and sales.
From December 2020 to March 2021, the working capital turnover increased significantly from 0.88 to 1.03, indicating a more efficient use of working capital to generate revenue. However, this trend reversed from June 2021 to March 2022, with the ratio declining steadily. This downward trend continued until March 2024, where the working capital turnover stood at 0.74.
A working capital turnover below 1 may indicate that the company is not efficiently using its current assets to support its sales and operations. Therefore, Texas Pacific Land Trust may need to reassess its working capital management strategies to improve efficiency and maximize the utilization of its current assets.
See also:
Texas Pacific Land Trust Working Capital Turnover (Quarterly Data)