Arrowhead Pharmaceuticals Inc (ARWR)

Receivables 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	3,551	14,386	25,053	166,263	225,258	245,998	267,743	278,338	243,231	249,939	263,418	144,424	138,288	107,638	89,123	79,841	87,993	123,653	138,974	163,593
Receivables	US$ in thousands	—	—	—	—	—	1,247	69,434	39,568	1,410	239	1,317	150	10,255	671	955	9,002	846	21,693	1,266	1,345
Receivables turnover		—	—	—	—	—	197.27	3.86	7.03	172.50	1,045.77	200.01	962.83	13.48	160.41	93.32	8.87	104.01	5.70	109.77	121.63

September 30, 2024 calculation

Receivables turnover = Revenue (ttm) ÷ Receivables
= $3,551K ÷ $—K
= —

The receivables turnover ratio measures how efficiently a company is managing its accounts receivable by evaluating how many times during a period the company collects its average accounts receivable balance. A higher receivables turnover ratio indicates that the company is collecting payments from its customers more quickly.

Analyzing Arrowhead Pharmaceuticals Inc's receivables turnover over the past several quarters, we observe significant fluctuations in the ratio. For the most recent quarter ending September 30, 2023, the receivables turnover ratio was 197.27, showcasing a substantial improvement compared to the previous quarter. This sharp increase indicates that the company's accounts receivable turnover has accelerated significantly, which can be a positive sign of effective collections and management.

Looking further back, we notice a wide range in receivables turnover ratios over the past few years, ranging from as low as 1.70 to as high as 1,045.77, suggesting inconsistency in the company's accounts receivable management. Quarterly variations in the ratio could be influenced by factors such as seasonal sales patterns, changes in credit policies, customer payment behavior, or fluctuations in sales volume.

It is crucial for Arrowhead Pharmaceuticals Inc to closely monitor and analyze its receivables turnover ratio trends to ensure efficient cash flow management and timely collections. By maintaining a healthy balance between credit sales and collection practices, the company can strive to optimize its working capital, enhance liquidity, and mitigate the risks associated with outstanding receivables.