Avanos Medical Inc (AVNS)

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	619,900	735,200	767,700	802,100	810,000	788,200	772,300	757,500	741,300	731,000	729,200	703,100	699,300	702,400	688,900	698,200	682,600	663,500	656,500	638,800
Total current assets	US$ in thousands	487,000	524,600	506,900	453,800	624,100	470,000	437,100	439,200	427,600	405,000	443,500	447,900	467,200	567,600	517,100	524,100	538,500	546,500	572,500	660,000
Total current liabilities	US$ in thousands	234,600	170,700	160,500	158,500	191,000	162,300	151,100	152,900	139,200	129,200	158,300	154,600	166,300	179,400	176,000	189,400	212,500	218,100	187,000	238,400
Working capital turnover		2.46	2.08	2.22	2.72	1.87	2.56	2.70	2.65	2.57	2.65	2.56	2.40	2.32	1.81	2.02	2.09	2.09	2.02	1.70	1.52

December 31, 2023 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $619,900K ÷ ($487,000K – $234,600K)
= 2.46

The working capital turnover ratio for Avanos Medical Inc has shown fluctuations over the past eight quarters. In Q4 2023, the ratio was 2.67, indicating that the company generated $2.67 in net sales revenue for every dollar of working capital invested. This ratio increased compared to Q3 2023 (2.12) and Q2 2023 (2.25) but was lower than Q1 2023 (2.76).

Looking at the trend over the previous quarters, the working capital turnover ratio has been relatively stable, fluctuating between 2.59 and 2.76. This suggests that Avanos Medical Inc has been efficiently utilizing its working capital to generate sales revenue. A higher turnover ratio indicates that the company is efficiently managing its working capital to support its operations and revenue generation.

Overall, the working capital turnover ratio of Avanos Medical Inc has been above 2 for the past eight quarters, indicating efficient utilization of working capital in generating sales. However, it is essential for the company to monitor and manage working capital effectively to sustain this operational efficiency in the future.