The Hackett Group's "Q2/2020 U.S. Working Capital Survey" found what many corporate treasurers know instinctively—that companies did everything they could to ensure they continued to have access to adequate liquidity as revenues shrunk in the early stages of the Covid-19 crisis.
In the study, The Hackett Group calculated working capital performance metrics for 849 large U.S.-based public companies that are outside the financial services sector. They found that revenue fell 14 percent, on average, from Q2/2019 to Q2/2020. Over the same period, gross margin fell 1.5 percent, earnings before interest and taxes (EBIT) margin fell 23 percent, and net income fell 61 percent. Companies responded to these changes by taking on more debt and pushing out their payables.
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