Westlake Chemical Corporation (WLK)
Working capital turnover
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (ttm) | US$ in thousands | 12,142,000 | 12,125,000 | 12,123,000 | 12,167,000 | 12,548,000 | 13,021,000 | 13,862,000 | 15,094,000 | 15,794,000 | 16,002,000 | 15,101,000 | 13,477,000 | 11,778,000 | 10,236,000 | 9,079,000 | 7,929,000 | 7,504,000 | 7,422,000 | 7,590,000 | 8,025,000 |
| Total current assets | US$ in thousands | 6,214,000 | 6,549,000 | 6,609,000 | 6,526,000 | 6,609,000 | 6,757,000 | 6,296,000 | 6,146,000 | 5,973,000 | 6,101,000 | 6,013,000 | 5,405,000 | 5,263,000 | 6,435,000 | 4,445,000 | 3,734,000 | 3,477,000 | 3,381,000 | 3,165,000 | 3,768,000 |
| Total current liabilities | US$ in thousands | 2,219,000 | 2,351,000 | 2,537,000 | 2,655,000 | 2,790,000 | 2,659,000 | 2,131,000 | 2,159,000 | 2,298,000 | 2,461,000 | 2,513,000 | 2,550,000 | 2,344,000 | 1,898,000 | 1,485,000 | 1,326,000 | 1,357,000 | 1,218,000 | 1,109,000 | 1,024,000 |
| Working capital turnover | 3.04 | 2.89 | 2.98 | 3.14 | 3.29 | 3.18 | 3.33 | 3.79 | 4.30 | 4.40 | 4.31 | 4.72 | 4.03 | 2.26 | 3.07 | 3.29 | 3.54 | 3.43 | 3.69 | 2.92 |
December 31, 2024 calculation
Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $12,142,000K ÷ ($6,214,000K – $2,219,000K)
= 3.04
Based on the provided data, the working capital turnover for Westlake Chemical Corporation has fluctuated over the period from March 31, 2020, to December 31, 2024. The working capital turnover ratio indicates the efficiency with which the company utilizes its working capital to generate sales revenue.
The working capital turnover ratio shows a general increasing trend from March 31, 2020, to December 31, 2022, indicating that the company was able to generate more sales revenue from each dollar of working capital. This upward trend suggests improved efficiency in managing working capital during this period.
However, from March 31, 2023, to December 31, 2024, the working capital turnover ratio declined, indicating a potential decrease in efficiency in utilizing working capital to generate sales revenue. The ratio peaked at 4.72 on March 31, 2022, and decreased to around 2.89 by September 30, 2024.
It is essential for Westlake Chemical Corporation to monitor and manage its working capital effectively to ensure optimal utilization and maintain a healthy balance between current assets and current liabilities. A declining working capital turnover ratio could signify inefficiencies or difficulties in converting working capital into sales, which may warrant further analysis and action to improve operational performance.
Peer comparison
Dec 31, 2024