ADMA Biologics Inc (ADMA)

Working capital turnover

		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	Dec 31, 2019
Revenue (ttm)	US$ in thousands	382,809	330,245	283,177	258,216	234,293	208,108	181,890	154,079	130,481	110,072	93,998	80,944	68,517	58,112	48,069	42,220	40,301	37,248	36,021	29,350
Total current assets	US$ in thousands	318,193	303,691	276,419	257,013	273,699	266,243	264,086	270,402	224,095	222,774	239,800	208,729	174,785	171,355	177,277	153,741	139,549	142,990	165,488	85,820
Total current liabilities	US$ in thousands	44,891	44,177	53,088	49,806	41,841	41,952	36,728	39,267	44,440	28,072	31,567	30,378	32,337	18,186	21,206	19,947	16,474	12,880	13,908	14,028
Working capital turnover		1.40	1.27	1.27	1.25	1.01	0.93	0.80	0.67	0.73	0.57	0.45	0.45	0.48	0.38	0.31	0.32	0.33	0.29	0.24	0.41

September 30, 2024 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $382,809K ÷ ($318,193K – $44,891K)
= 1.40

The working capital turnover ratio measures a company's ability to utilize its working capital efficiently to generate sales. A higher ratio indicates that the company is effectively managing its working capital to support revenue generation.

In the case of ADMA Biologics Inc, the working capital turnover has shown a fluctuating trend over the past several periods. The ratio has generally been improving from 0.24 in December 2019 to 1.40 in September 2024. This indicates that the company has been able to more efficiently convert its working capital into sales in recent quarters.

The significant increase in the working capital turnover ratio reflects improved operational efficiency and potentially better management of inventory and receivables. It suggests that ADMA Biologics is becoming more effective in utilizing its current assets to drive sales growth.

However, it is important to note that a single financial ratio should not be analyzed in isolation, as other factors such as industry benchmarks, overall financial health, and strategic initiatives also play a crucial role in evaluating a company's performance.