Varex Imaging Corp (VREX)
Working capital turnover
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 893,400 | 859,400 | 818,100 | 738,300 | 780,600 |
| Total current assets | US$ in thousands | 658,300 | 609,900 | 554,200 | 522,000 | 438,400 |
| Total current liabilities | US$ in thousands | 162,800 | 173,100 | 166,600 | 160,600 | 175,100 |
| Working capital turnover | 1.80 | 1.97 | 2.11 | 2.04 | 2.96 |
September 30, 2023 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $893,400K ÷ ($658,300K – $162,800K)
= 1.80
Varex Imaging Corp's working capital turnover has shown a declining trend over the past five years, from 2.96 in 2019 to 1.80 in 2023. This indicates that the company is generating less revenue relative to its working capital investment. A lower working capital turnover ratio could suggest inefficiencies in managing inventory, accounts receivable, and accounts payable, which may lead to tying up more capital in operations.
The decreasing trend in working capital turnover could also be a sign of potential liquidity issues or declining operational efficiency. It may be beneficial for the company to evaluate and streamline its working capital management processes to improve cash flow and overall financial performance. Additional analysis of the company's inventory turnover, accounts receivable turnover, and accounts payable turnover ratios could provide further insights into the efficiency of Varex Imaging Corp's working capital management.
Peer comparison
Sep 30, 2023