Tyson Foods Inc (TSN)
Working capital turnover
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 52,881,000 | 53,282,000 | 47,049,000 | 43,185,000 | 42,405,000 |
| Total current assets | US$ in thousands | 8,722,000 | 9,630,000 | 9,822,000 | 7,598,000 | 6,990,000 |
| Total current liabilities | US$ in thousands | 6,499,000 | 5,313,000 | 6,325,000 | 4,234,000 | 5,513,000 |
| Working capital turnover | 23.79 | 12.34 | 13.45 | 12.84 | 28.71 |
September 30, 2023 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $52,881,000K ÷ ($8,722,000K – $6,499,000K)
= 23.79
The working capital turnover ratio measures the efficiency of a company in utilizing its working capital to generate sales. It is calculated by dividing the net sales by the average working capital. A higher ratio indicates that the company is effectively using its working capital to generate sales.
Based on the provided data, Tyson Foods, Inc.'s working capital turnover has fluctuated over the past five years. As of September 30, 2023, the working capital turnover ratio was 23.79, showing a significant increase from the previous year. This substantial increase suggests that Tyson Foods improved its efficiency in utilizing its working capital to generate sales.
In contrast, the working capital turnover ratio was 12.34 as of October 1, 2022, indicating a decrease from the previous year. However, it is worth noting that the working capital turnover ratio for fiscal year 2021 was 13.45, showing a slight improvement from the previous year.
Furthermore, the ratio for fiscal year 2020 was 12.84, which was slightly lower than the ratio for fiscal year 2021, indicating a temporary decrease in efficiency. The trend continues with the ratio of 25.61 in fiscal year 2019, showing a substantial improvement in utilizing working capital to generate sales.
Overall, the working capital turnover ratio for Tyson Foods, Inc. has been volatile over the past five years, with fluctuations in efficiency in using working capital to generate sales. The significant increase in the ratio for 2023 indicates a notable improvement in efficiency, which could be a positive sign for the company's financial performance. However, it is essential to monitor this ratio over time to assess the company's ongoing efficiency in managing its working capital.
Peer comparison
Sep 30, 2023