Trane Technologies plc (TT)
Working capital turnover
| 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 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (ttm) | US$ in thousands | 19,814,000 | 19,303,200 | 18,684,100 | 18,022,900 | 17,422,900 | 17,077,000 | 16,568,400 | 16,055,800 | 15,750,100 | 15,248,500 | 14,597,800 | 14,234,700 | 13,892,000 | 13,496,200 | 13,266,900 | 12,575,200 | 12,196,000 | 13,164,400 | 14,008,900 | 15,396,900 |
| Total current assets | US$ in thousands | 7,337,800 | 8,099,700 | 7,714,000 | 6,887,200 | 6,869,900 | 6,726,900 | 6,675,000 | 6,074,800 | 6,379,200 | 6,299,100 | 6,125,200 | 6,030,500 | 6,470,900 | 6,991,400 | 7,125,100 | 6,622,100 | 6,905,600 | 6,973,500 | 6,344,700 | 6,559,800 |
| Total current liabilities | US$ in thousands | 6,068,900 | 6,628,900 | 6,592,400 | 6,101,900 | 6,053,500 | 5,214,200 | 5,593,200 | 4,831,400 | 5,686,800 | 5,545,500 | 5,630,300 | 4,594,400 | 4,752,400 | 4,313,500 | 4,512,900 | 4,174,600 | 4,338,900 | 4,170,100 | 3,829,200 | 4,240,800 |
| Working capital turnover | 15.62 | 13.12 | 16.66 | 22.95 | 21.34 | 11.29 | 15.32 | 12.91 | 22.75 | 20.23 | 29.50 | 9.91 | 8.08 | 5.04 | 5.08 | 5.14 | 4.75 | 4.70 | 5.57 | 6.64 |
December 31, 2024 calculation
Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $19,814,000K ÷ ($7,337,800K – $6,068,900K)
= 15.62
Trane Technologies plc's working capital turnover has shown fluctuations over the observed periods. The ratio ranged from a low of 4.70 in September 30, 2020 to a high of 29.50 in June 30, 2022. Generally, a higher working capital turnover signifies efficient management of working capital, indicating that the company efficiently generates revenue using its working capital.
The ratio increased significantly from June 30, 2022, reaching a peak of 29.50, indicating a substantial improvement in working capital management efficiency. However, this peak was followed by a decline in subsequent periods.
From a financial analysis perspective, it is important to understand the reasons behind such significant fluctuations in the working capital turnover ratio, as it can provide insights into the company's operational efficiency and liquidity management.
Overall, the working capital turnover trend of Trane Technologies plc demonstrates a mix of both strong and weak periods in terms of utilizing working capital to generate revenue. Monitoring this ratio over time can provide valuable information about the company's operational performance and financial health.
See also:
Trane Technologies plc Working Capital Turnover (Quarterly Data)