Varex Imaging Corp (VREX)
Working capital turnover
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 811,000 | 893,400 | 859,400 | 818,100 | 738,300 |
| Total current assets | US$ in thousands | 649,900 | 658,300 | 609,900 | 554,200 | 522,000 |
| Total current liabilities | US$ in thousands | 195,900 | 162,800 | 173,100 | 166,600 | 160,600 |
| Working capital turnover | 1.79 | 1.80 | 1.97 | 2.11 | 2.04 |
September 30, 2024 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $811,000K ÷ ($649,900K – $195,900K)
= 1.79
The working capital turnover of Varex Imaging Corp has shown a downward trend over the past five years, from 2.04 in 2020 to 1.79 in 2024. This ratio indicates how efficiently the company is utilizing its working capital to generate sales. A higher turnover ratio is generally considered favorable as it shows that the company is effectively using its current assets to support revenue generation.
Although the working capital turnover has decreased over the years, it still remains above 1, indicating that Varex Imaging Corp is able to generate sales with the working capital it has on hand. This suggests that the company has been managing its working capital efficiently, although there may have been some decline in efficiency compared to previous years.
It is important for Varex Imaging Corp to closely monitor its working capital turnover and analyze the factors contributing to this trend to ensure optimal efficiency in utilizing current assets to drive sales growth.
Peer comparison
Sep 30, 2024