Verra Mobility Corp (VRRM)

Working capital turnover

Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Revenue US$ in thousands 103,570 94,318 39,977 13,302 388,008
Total current assets US$ in thousands 439,538 362,594 348,069 328,037 272,438
Total current liabilities US$ in thousands 214,773 186,809 175,191 64,040 104,881
Working capital turnover 0.46 0.54 0.23 0.05 2.32

December 31, 2023 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $103,570K ÷ ($439,538K – $214,773K)
= 0.46

The working capital turnover ratio of Verra Mobility Corp has fluctuated over the past five years. In 2023, the ratio stands at 3.64, indicating that the company generated $3.64 in revenue for every dollar of working capital invested. This represents a decrease from the previous year where the ratio was 4.22.

The decreasing trend in the working capital turnover ratio from 2022 to 2023 suggests that the company may be becoming less efficient in utilizing its working capital to generate sales. However, it is important to note that the current ratio of 3.64 is still higher than the ratios observed in 2021, 2020, and 2019, indicating improved efficiency compared to those years.

Overall, while the recent decline in the working capital turnover ratio raises questions about the company's working capital management efficiency, a comparison with historical data shows that Verra Mobility Corp has generally maintained a reasonably good level of efficiency in utilizing its working capital to drive revenue generation.