Weatherford International PLC (WFRD)
Working capital turnover
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (ttm) | US$ in thousands | 5,023,000 | 4,982,000 | 4,789,000 | 4,579,000 | 4,331,000 | 4,087,000 | 3,912,000 | 3,751,000 | 3,645,000 | 2,718,000 | 3,357,000 | 4,096,000 | 4,479,000 | 5,656,000 | 5,386,000 | 5,053,000 | 5,184,000 | 5,315,000 | 5,445,000 | 5,584,000 |
| Total current assets | US$ in thousands | 3,345,000 | 3,220,000 | 2,971,000 | 3,043,000 | 3,043,000 | 3,063,000 | 3,010,000 | 2,889,000 | 2,911,000 | 3,244,000 | 3,126,000 | 3,158,000 | 3,177,000 | 3,293,000 | 2,927,000 | 3,374,000 | 3,453,000 | 3,924,000 | 3,406,000 | 3,406,000 |
| Total current liabilities | US$ in thousands | 1,866,000 | 1,731,000 | 1,464,000 | 1,511,000 | 1,470,000 | 1,384,000 | 1,383,000 | 1,300,000 | 1,332,000 | 1,524,000 | 1,243,000 | 1,364,000 | 1,362,000 | 1,416,000 | 1,426,000 | 1,644,000 | 1,672,000 | 3,380,000 | 2,889,000 | 2,504,000 |
| Working capital turnover | 3.40 | 3.35 | 3.18 | 2.99 | 2.75 | 2.43 | 2.40 | 2.36 | 2.31 | 1.58 | 1.78 | 2.28 | 2.47 | 3.01 | 3.59 | 2.92 | 2.91 | 9.77 | 10.53 | 6.19 |
December 31, 2023 calculation
Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $5,023,000K ÷ ($3,345,000K – $1,866,000K)
= 3.40
Weatherford International plc's working capital turnover has shown a consistent positive trend over the past eight quarters, starting at 2.36 in Q1 2022 and reaching 3.47 in Q4 2023. This indicates an improvement in the company's efficiency in managing its working capital.
A working capital turnover ratio above 1 implies that the company is generating revenue more efficiently relative to its working capital. The increasing trend signifies that Weatherford International plc has been able to convert its current assets into revenue at a faster rate over time.
The noticeable increase in the working capital turnover from Q1 2023 (2.99) to Q4 2023 (3.47) suggests that the company has been able to optimize its working capital management further in the most recent quarter. This could be attributed to effective inventory management, better accounts receivable collection, or improved accounts payable management.
Overall, the upward trend in working capital turnover reflects positively on Weatherford International plc's operational efficiency and financial health, indicating a more effective utilization of its resources to generate revenue. However, it's essential to continue monitoring this ratio in the future to ensure sustained efficiency in working capital management.
Peer comparison
Dec 31, 2023