Vulcan Materials Company (VMC)
Working capital turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 7,417,700 | 7,781,900 | 7,315,200 | 5,552,200 | 4,856,830 |
| Total current assets | US$ in thousands | 2,265,700 | 2,524,900 | 1,902,000 | 1,691,100 | 2,277,160 |
| Total current liabilities | US$ in thousands | 1,239,100 | 797,600 | 956,600 | 769,300 | 1,047,880 |
| Working capital turnover | 7.23 | 4.51 | 7.74 | 6.02 | 3.95 |
December 31, 2024 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $7,417,700K ÷ ($2,265,700K – $1,239,100K)
= 7.23
The working capital turnover ratio for Vulcan Materials Company has shown fluctuations over the years. In 2020, the ratio was 3.95, indicating that the company generated $3.95 in net sales for every $1 of working capital invested.
By 2021, the ratio improved to 6.02, showing that the company's efficiency in utilizing its working capital had increased significantly. This suggests that the company was able to generate more sales relative to its investment in working capital.
In 2022, Vulcan Materials Company further improved its working capital turnover to 7.74, demonstrating a continued efficiency in managing its working capital to drive sales.
However, in 2023, there was a slight decline in the working capital turnover to 4.51, which could indicate a temporary dip in the company's ability to convert working capital into sales efficiently.
By 2024, the working capital turnover ratio rebounded to 7.23, showing a strong recovery in the company's efficiency in using its working capital to generate sales.
Overall, the trend in Vulcan Materials Company's working capital turnover reflects varying levels of efficiency in utilizing working capital to drive sales over the years, with a notable improvement in recent years. Management should continue to monitor and optimize this ratio to sustain and improve profitability.
Peer comparison
Dec 31, 2024