UFP Technologies Inc (UFPT)

Working capital turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Revenue	US$ in thousands	398,082	374,929	206,246	178,831	197,707
Total current assets	US$ in thousands	144,633	116,346	87,320	71,864	53,250
Total current liabilities	US$ in thousands	58,209	55,961	38,783	15,137	16,784
Working capital turnover		4.61	6.21	4.25	3.15	5.42

December 31, 2023 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $398,082K ÷ ($144,633K – $58,209K)
= 4.61

The working capital turnover ratio measures how efficiently a company is utilizing its working capital to generate sales revenue. A higher ratio indicates better efficiency in using its current assets.

In the case of UFP Technologies Inc, the working capital turnover has fluctuated over the past five years. In 2023, the working capital turnover ratio was 4.61, a decrease from the previous year's ratio of 6.21. This suggests that the company was slightly less efficient in using its working capital to generate sales revenue in 2023 compared to 2022.

Looking further back, the trend indicates variability in the company's management of working capital efficiency. In 2021, the working capital turnover was 4.25, lower than the previous year, indicating a decrease in efficiency. However, in 2020, the ratio improved to 3.15, reflecting a more efficient use of working capital to generate sales revenue.

Overall, the fluctuating trend in UFP Technologies Inc's working capital turnover ratio suggests varying levels of efficiency in managing its working capital over the past five years. Further analysis and comparison with industry benchmarks may provide more insights into the company's working capital management performance.