Biogen Inc (BIIB)

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	9,835,600	9,993,300	9,971,500	10,104,600	10,173,400	10,363,200	10,633,600	10,819,500	10,981,700	11,100,500	11,697,700	12,604,300	13,444,600	14,263,300	14,487,300	14,422,400	14,377,900	14,232,900	14,071,800	13,811,600
Total current assets	US$ in thousands	6,859,300	8,454,100	10,431,700	9,762,500	9,791,200	9,765,800	9,740,900	7,915,900	7,856,500	7,162,300	7,183,700	6,719,500	6,887,100	7,843,100	8,493,800	8,007,200	8,381,800	8,448,200	7,909,800	8,942,600
Total current liabilities	US$ in thousands	3,434,300	5,022,300	3,186,500	3,014,900	3,272,800	3,926,400	5,018,000	3,946,600	4,298,200	4,211,600	3,347,200	3,165,800	3,742,200	3,804,000	3,447,100	4,638,600	4,863,800	4,432,200	3,210,900	3,148,700
Working capital turnover		2.87	2.91	1.38	1.50	1.56	1.77	2.25	2.73	3.09	3.76	3.05	3.55	4.28	3.53	2.87	4.28	4.09	3.54	2.99	2.38

December 31, 2023 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $9,835,600K ÷ ($6,859,300K – $3,434,300K)
= 2.87

The working capital turnover ratio measures how efficiently a company is utilizing its working capital to generate sales revenue. A higher ratio indicates that the company is effectively managing its working capital.

Biogen Inc's working capital turnover has been fluctuating over the past eight quarters. In Q4 2023, the ratio stands at 2.87, slightly lower than the previous quarter's ratio of 2.91. This indicates that in Q4 2023, Biogen Inc generated $2.87 in sales for every dollar of working capital invested.

The ratio was relatively low in Q2 2023 at 1.38, suggesting a less efficient utilization of working capital during that period. However, there was an improvement in Q3 2023, with a ratio of 1.50, indicating a better performance in converting working capital into sales revenue.

Comparing the current ratio with the same quarter in the previous year, we see a decreasing trend in working capital turnover since Q1 2022. In Q4 2022, the ratio was 1.56, which has declined from the peak of 2.73 in Q1 2022. This declining trend may indicate that Biogen Inc is experiencing challenges in efficiently utilizing its working capital to support its sales growth.

Overall, it is important for Biogen Inc to closely monitor and manage its working capital turnover to ensure optimal efficiency in utilizing its resources to drive revenue generation.