Vestis Corporation (VSTS)
Working capital turnover
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 2,800,900 | 2,825,290 | 2,687,000 | 2,456,580 | 2,562,000 |
| Total current assets | US$ in thousands | 787,389 | 1,019,960 | 987,281 | 931,924 | — |
| Total current liabilities | US$ in thousands | 456,102 | 395,525 | 402,195 | 383,322 | — |
| Working capital turnover | 8.45 | 4.52 | 4.59 | 4.48 | — |
September 30, 2024 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $2,800,900K ÷ ($787,389K – $456,102K)
= 8.45
The working capital turnover ratio measures how efficiently a company is using its working capital to generate sales revenue. Vestis Corporation's working capital turnover has shown an increasing trend from 4.48 in 2021 to 8.45 in 2024.
This indicates that Vestis Corporation is generating sales revenue more efficiently with its working capital over the years. A higher working capital turnover ratio generally implies that the company is effectively managing its working capital by quickly converting it into sales.
The significant improvement in the working capital turnover ratio suggests that Vestis Corporation has been able to optimize its working capital usage and generate more sales with the same level of working capital. This could be attributed to better inventory management, more efficient accounts receivable collections, or streamlined accounts payable processes.
Overall, the increasing trend in Vestis Corporation's working capital turnover ratio reflects a positive trend in the company's management of working capital and its ability to efficiently utilize its resources to drive sales growth.
Peer comparison
Sep 30, 2024