Valvoline Inc (VVV)
Working capital turnover
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 1,440,900 | 1,232,700 | 2,945,000 | 2,375,000 | 2,390,000 |
| Total current assets | US$ in thousands | 936,700 | 1,621,100 | 1,037,100 | 1,438,000 | 797,000 |
| Total current liabilities | US$ in thousands | 362,300 | 919,400 | 568,700 | 444,000 | 423,000 |
| Working capital turnover | 2.51 | 1.76 | 6.29 | 2.39 | 6.39 |
September 30, 2023 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $1,440,900K ÷ ($936,700K – $362,300K)
= 2.51
The working capital turnover ratio indicates how efficiently a company is utilizing its working capital to generate sales. A higher ratio suggests better efficiency in using current assets and liabilities to support sales.
Valvoline Inc's working capital turnover has fluctuated over the past five years. In 2023, the ratio stood at 2.51, indicating an increase from the previous year's 1.76. This suggests that Valvoline Inc was able to generate sales more efficiently using its working capital in 2023 compared to 2022.
However, when comparing the 2023 ratio to those of 2021 and 2019, it is notably lower. In 2021 and 2019, the company achieved much higher working capital turnover ratios of 6.37 and 6.39, respectively. This indicates a significant decrease in efficiency in utilizing working capital to support sales in 2023 compared to those two years.
Overall, Valvoline Inc's working capital turnover has displayed variability, indicating fluctuating efficiency in utilizing its working capital to generate sales over the past five years. Further analysis of the company's working capital management and sales generation strategies may be necessary to understand the reasons behind these fluctuations.
Peer comparison
Sep 30, 2023